Shyamal Kumar Sen, J. - (1.) On an application under Section 256(1) of the Income-tax Act, 1961, the following questions are referred to this court for opinion : "(1) Whether, on the facts and in the circumstances of the case, the finding of the Tribunal was perverse in law in applying the decisions of the High Court in the two cases of CIT v. Orient Supply Syndicate and Shalimar Chemical Works Pvt. Ltd. v. CIT, in the present case for allowing a deduction of market fees amounting to Rs. 3,07,334 levied in 1977-78 up to March 31, 1979, the liability of which was provided for and written off in 1979-80 and the same was re-levied in 1980-81, in the assessment year 1983-84 although the facts and circumstances of the present case are not similar to those of the cases relied on by the Tribunal ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the claim of deduction of Rs. 3,07,334 being market fees levied in 1977-78 up to March 31, 1979, from two per cent. to three per cent., the liability of which was provided and was written off in 1979-80 but the same was re-levied on 1980-81, was an allowable deduction in the assessment year 1983-84 ?"
(2.) The facts, inter alia, as appear from the statement of case are that the assessee is a resident company. The assessment year involved in question is 1983-84. The accounting period relevant to the assessment year ended on March 31, 1983. The Assessing Officer completed the assessment for the assessment year 1983-84 under Section 143(3) of the Income-tax Act, 1961, on February 28, 1986. In the course of the assessment proceedings, the Assessing Officer found that a sum of Rs. 3,07.334 was debited on March 31, 1983, on account of market fee levied in the financial year 1980-81. He further found that the amount was included in the purchase account. The Assessing Officer relied on the relevant entry in the journal in respect of this amount by translating the extract from the journal book for the year ending on March 31, 1983. These entries are as follows : Rs. 3,07,334.67 Market fees account dated March 31, 1983 3,07,334.07 To liabilities for expenses
(3.) being market fees levied in 1977-78 up to March 31, 1979, from two per cent. to three per cent., liability provided and was written off in 1979-80. Again, this liability was re-levied in 1980-81 and liabilities provided. The entry itself indicated that the market fee was levied in the accounting period 1980-81, which is relevant to the assessment year 1981-82, and it had no relevance to the assessment year 1983-84. This liability for market fee arose on May 15, 1980, when the Governor of Haryana issued the Ordinance in this respect. This date, according to the Revenue, is relevant to the assessment year 1981-82. The Market Committee, Sirsa, asked the assessee to deposit Rs. 3,37,579.90 by December 10, 1980. This date was also relevant to the assessment year 1981-82. The Assessing Officer further found that neither the demand had arisen in the accounting period relevant to the assessment year 1983-84 nor had it been paid during that period. Accordingly, he disallowed the assessee's claim of deduction of Rs. 3,07,334 in the assessment year 1983-84.;