Kirpal, J. - (1.) In these appeals by certificate granted by the Kerala High Court, the following question of law has been referred in respect of the assessment year 1978-79:-"Whether, the Tribunal was right in law in holding that the statutory deduction under Section 36 (1)(viii) of the I.T. Act, 1961 should be calculated on the total income before deduction of the amount allowable under the section -
(2.) The Kerala High Court came to the conclusion that in computing the total income for the purpose of Section 36 (1)(viii) of the Income-tax Act, 1961, the total income has to be computed in accordance with the provisions of Sections 30 to 43-A except Section 36 (1)(viii). In arriving at this decision, the High Court relied upon the observations of this Court in Cambay Electric Supply Industrial Co. Ltd. v. Commr. of Income-tax, (1978) 113 ITR 84 .
(3.) The view which was taken by the Kerala High Court was in consonance with the view taken by the Patna High Court in three decisions, Madhya Pradesh High Court in two decisions and Kerala High Court itself in an earlier decision. It is stated that subsequent to the decision under appeal, other High Courts have also taken the same view. The only dissenting view which has been expressed is by the Karnataka High Court in Karnataka State Financial Corporation v. Commr. of Income Tax, (1988) 174 ITR 206.;