Commissioner of Income Tax, Meerut vs Ishwar Saran Gupta and Sons

ORDER

The Income Tax Appellate Tribunal has referred the following question of law u/s 256(1) of the Income Tax Act, 1961 (hereinafter referred to as ''the Act) for opinion to this court :

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was legally correct in holding that the assessee is entitled to investment allowance u/s 32A of the Income Tax Act, 1961 ?"

The present reference relates to the assessment year 1987-88.

Briefly stated the facts giving rise to the present reference are as follows :

The respondent-assessee is assessed of the income in the status of HUF, which enjoys income from letting out on hire kolhus and karhawas. It claimed as investment allowance of Rs. 14,000 u/s 32A of the Act, which was disallowed by the assessing authority. Feeling aggrieved the respondent-assessee preferred an appeal before the Commissioner (Appeals) on the basis decision of the Delhi Bench of the Tribunal in ITA Nos. 5790 to 5792/ Delhi/ 85 for assessment years 1981-82, 1982-83 and 1983-84 in the case of M/s. Jagat Narain Chand Lal had accepted the claim, which order has been upheld by the Tribunal.

We have heard Sri A.N. Mahajan, learned standing counsel for the revenue. Nobody has appeared for the respondent-assessee.

We find that this court in CIT v. Dhoom Sen Shyam Lal & Co. (IT Reference No. 184 of 1984, dated 27-8-2004) has held that investment allowance u/s 32A of the Act is admissible in respect of letting out kolhus and boiling pans (karhawas). While holding so it has followed the decision of the Apex Court in the case of Commissioner of Income Tax, Karnataka, Bangalore Vs. M/s. Shaan Finance (P) Ltd., Bangalore, .

Respectfully following the aforesaid decision, we answer the question referred to us in the affirmative, i.e., in favour of the assessee and against the revenue. There shall be no order as to costs.