MERCANTILE BANK LIMITED Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) BY this reference under S.256(1) of the IT Act, 1961, the Tribunal has referred the following questions of law for the opinion of this Court at the instance of the Department. Department's questions :

(2.) AT the outset, it may be mentioned that learned counsel for the parties stated that all the above questions stand covered by the various judgments of this Court and the Supreme Court.

(3.) THE controversy in question No. 2 is squarely covered by the judgments of the Supreme Court in State Bank of Travancore vS.CIT (1986) 50 CTR (SC) 290 : (1986) 158 ITR 102 (SC) and in Kerala Financial Corporation vS.CIT (1994) 119 CTR (SC) 164 : (1994) 210 ITR 129 (SC) and the judgment rendered today by us in IT Ref. No. 83 of 1986 Banque Nationale de Paris vS.CIT [reported at (1999) 154 CTR (Bom) 579]. Accordingly, question No. 2 is answered in the negative, i.e., against the assessee and in favour of the Revenue.