- (1.) THIS appeal filed under section 260-A of the Income Tax Act, 1961 ('act' for short) was initially heard by a division Bench of this Court and by an order dated 19-12-2008, the said Division bench requested the learned Chief Justice to constitute a larger Bench to consider the following question of law: "whether, in the facts and circumstances of the case, for the purposes of availing allowable special deduction under Chapter VI-A of the income-tax Act, the gross total income is required to be computed by deducting allowable depreciation even though the assessee had disclaimed the same for the purposes of regular assessment ?"
(2.) ON the above question of law, the Division Bench observed that there are conflicting decisions rendered by the two Division Benches of this Court in the case of (Grasim Industries Limited Vs. C. I. T.), reported in 245 I. T. R. 677 (Born.) and in the case of (M/s. Scoop Industries (P) Limited vs. Income Tax Officer), reported in 289 i. T. R. 195 (Bom. ). The Division Bench further observed that since the above two decisions do not go hand-in-hand, and run counter to each other, the issue ought to be resolved by a larger Bench. Accordingly, the learned Chief Justice has constituted this Full Bench for resolving the above controversy.
(3.) FACTS relevant to the present case are that the respondent [hereinafter referred to as the assessee'] is a Company incorporated under the Companies Act, 1956 and is engaged in the manufacture of master batches and compounds at its units situated at Daman.;