- (1.) In this case, certificate has been granted by the High Court u/s. 261 of the Income-tax Act, 1961, only with respect to question Nos. 2, 3 and 4, which read thus : " 2. Whether, on the facts and in the circumstances of the case, the finding of the Tribunal that in applying sec. 79 of the Act, only the business loss should be taken into account and not the unabsorbed depreciation or unabsorbed development rebate, is erroneous in law 3. Whether, on the facts and in the circumstances of the case, the Tribunal erred in law in holding that in order to invoke the provisions of sec. 79 of the Act, the Department must prove not only that there was a transfer of the shareholding of not less than 51 per cent of the voting power as per cl. (a) of sec. 79, but also that such a transfer was with the intent to reduce or avoid the tax liability as per cl. (b) of sec. 79 4. Whether, on the facts and in the circumstances of the case, it is established from the material on the record of the case that the condition of the exception cl. (a) of sec. 79 of the Act is not fulfilled and, therefore, no loss incurred in any year prior to the previous year corresponding to the assessment year under reference could be carried forward and set off against the income of the said previous year -
(2.) Mr. J. Ramamurthy, the learned senior counsel for the revenue, states fairly that so far as question Nos. 3 and 4 are concerned, they are concluded against the revenue by the decision of this Court in CIT V/s. Italindia Cotton Co. (P.) Ltd., 1988 174 ITR 160. The said decision in fact expressly approves the decision now under appeal herein.
(3.) So far as question No. 2 is concerned, the question is whether in applying sec. 79 of the Act, only the business loss should be taken into account and not the unabsorbed depreciation or unabsorbed development rebate. The High Court has answered the question saying that when sec. 79 speaks of loss, it does not include unabsorbed depreciation or unabsorbed development rebate. We agree with the High Court. The appeals are, accordingly, dismissed. No costs.;