- (1.) AT the instance of the assessee, the following two questions of law have been referred for our opinion : "1. Whether, on the facts and in the circumstances of the case, the assessee's profits and gains earned in the calendar year 1957 were assessable to tax for the assessment year 1958-59 at the rates prescribed by the Finance Act, 1958, or in accordance with Clause 23 of the agreement dated April 1, 1938, entered into between the assessee and the erstwhile Jind State ?
(2.) WHETHER, on the facts and in the circumstances of the case, the Tribunal was right in not deducting a sum of Rs. 8,881 representing commission paid on borrowing shares for purpose of pledging them as security with the income-tax department for securing stay of recovery of certain taxes, in the computation of profits and gains of business of the assessee-company ?" 2. So far as the answer to the first question is concerned, it has to be in the same terms as our answer in. Income-tax Reference No. 20 of 1970, Dalmia Dadri Cement Ltd, v. Commissioner of Income-tax [1972] 86 I. T. R. 580 (Punj.) (Appendix ). decided today, that is, the answer has to be in favour of the department and against the assessee.
(3.) SO far as the second question is concerned, the contention of the learned counsel for the assessee is based on two decisions of the Supreme Court in India Cements Ltd. v. Commisssioner of Income-tax, [1966] 60 I. T. R. 52 ; [1966] 2 S. C. R. 944 (S. C.) and Jeewanlal (1929) Ltd. v. Commissioner of Income-tax, [1969] 74 I. T. R. 753 (S. C. ). Before we deal with these decisions, it will be proper to mention the brief facts and the contention advanced.;