A.K. Sen Gupta, J. - (1.) At the instance of the Commissioner, West Bengal -IV, Calcutta, the following question of law for the assessment year 1976 -77 has been referred to this Court under Sec. 256(1) of the Income -tax Act, 1961 ('the Act'): Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that deduction under Sec. 80J of the Income -tax Act, 1961 should not be computed proportionately with reference to the number of days of operation during the relevant accounting year ? The ITO disallowed the claim of the assessee for the relief under Sec. 80J(3) of the Act in respect of the new sumithion unit since that was in operation only for 3 days in the accounting year and that the unit showed a loss of Rs. 13,86,807 and unabsorbed development rebate of Rs. 3,26,128. The ITO restricted the amount to Rs. 4,368 proportionate to the number of days operated by the unit during the accounting year.
(2.) On appeal by the assessee, the Commissioner (Appeals) after considering the facts of the case followed the decision of the Madras High Court in the case of CIT v/s. Simpson & Co. : [1980] 122 ITR 283 and directed the ITO to compute the deduction at 6 per cent of the capital calculated and not to restrict the same with reference to the number of days the unit operated. The matter was brought before the Tribunal by the revenue challenging the direction of the Commissioner (Appeals). The Tribunal noted that it was not disputed that the decision in the case of Simpson & Co. (supra) was applicable. It also noted that the Tribunal, Calcutta Bench 'A' in the case of the same assessee has held likewise for the assessment year 1975 -76. The appeal by the revenue was dismissed.
(3.) On those facts the question quoted before has been referred to this Court.;