Liberty Footwear Co. vs Commissioner of Income-Tax

The question as framed by the High Court in the appeal under Section 260A of the Income Tax Act, 1961 before it is in the following terms:

"Whether, on the facts and the circumstances of the case, the Income-Tax Appellate Tribunal was correct in law in directing the Assessing Officer to allow netting in interest for computing deduction under Section 80HHC of the Income-Tax Act?"

The aforesaid question has been answered by this Court in ACG Associated Capsules (P) Ltd. v. Commissioner of Income Tax [(2012) 67 DTR (SC) 205]. However, the learned counsel for the Revenue submits that the question as framed really does not arise and the High Court had committed an error in framing the question in the above terms and in answering the same. In this regard, the learned counsel for the Revenue has taken us through the order of the Income Tax Appellate Tribunal and also the decision of this Court in Pandian Chemicals Ltd. v. Commissioner of Income Tax, Madurai [(2003) 5 SCC 590].

As in the present appeal by the Assessee we are only concerned with the correctness of the opinion of the High Court on the question framed by it, we answer the same in favour of the Assessee following the decision of this Court in ACG Associated Capsules (P) Ltd. (supra). However, if the Revenue has any grievance(s) with regard to the question framed and the relevance thereof to the present case, it will be open for the Revenue to take out such remedies as may be available to it in law including the remedy of moving the High Court by way of review.

The appeal stands disposed of in the above terms.