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Judgment
R. L. Gulati, J. - In respect of the assessment year 1969-70 the assessee claimed development rebate-in respect of the machinery installed in the relevant previous year. The development rebate was allowed. Subsequently the Income Tax Officer took proceedings u/s 154 of the Act on the ground that the order passed by him allowing development rebate was erroneous as the assessee was not entitled to the deduction on account of the development rebate, because he had not created a reserve as required by section 34(3)(a) of the Income Tax Act the Income Tax Appellate Tribunal has noticed that there are certain decisions which show that if the trading accounts result in a loss, a reserve need not be created and there are other decisions where it has been held that without a reserve, development rebate cannot be allowed. In the opinion of the Tribunal it was a debatale question and could not be said to involve a mistake apparent on the face of the record which could be rectified u/s 154. In our opinion the view taken by the Tribunal is correct. There is no question of law upon which a reference can be called.
The application is rejected.