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Judgment
T.D. Sugla, J.—In this assessee''s reference relating to its assessment for asst. yr. 1966-67, the Tribunal has referred to this Court the following question of law under s. 256(1) of the IT Act, 1961 :
"Whether, in the circumstances and facts of the case, the Tribunal was right in holding that in computing the capital of a new unit for the purpose of r. 19A, head office balance reflected in the new unit''s balance-sheet has to be allocated between external borrowings and assessee''s own funds and that the sum so arrived at representing external borrowings has to be considered as a liability of the new unit ?"
The counsel are agreed that in view of our Court''s judgment in the case of Indian Oil Corporation Ltd. Vs. S. Rajagopalan, Income Tax Officer, Companies Circle II(1), Bombay and Others, , which has been accepted by the CBDT vide its Circular No. 380, dt. 10th April, 1984 reported in Additional Commissioner of Income Tax, Delhi-II Vs. Rattan Chand Kapoor, , the question is to be answered in the affirmative and in favour of the assessee. The question is so answered.
No order as to costs.