V.K. Singhal, J. - (1.) THE Commissioner of Income-tax has moved under Section 256(2) of the Income-tax Act, 1961, to this court for directing the Income-tax Appellate Tribunal to state the case and refer the following question of law for the opinion of this court : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in allowing investment allowance of Rs. 35.8.3 lakhs on the ground that it had allowed the claim for the assessment year 1977-78 ?"
(2.) IN the case of the assossee, for the assessment year 1977-78, the investment allowance was allowed by the INcome-tax Appellate Tribunal against which a reference application was submitted by the Commissioner of INcome-tax and a reference has already been made, which is said to be pending before this court. IN respect of the assessment year 1978-79, the Tribunal observed that, if the investment allowance is not allowable in year 1977-78, then it may be considered for the assessment year 1978-79 and this too is subject to the order of the High Court for the assessment year 1977-78. IN the light of these observations, it was considered by the Tribunal that since reference has already been made and is pending in the High Court then the application for the year 1978-79 has become infructuous. The reference application under Section 256(1) of the Act was rejected. In the present case, when an appeal was preferred before the Income-tax Appellate Tribunal, the assessee submitted that the investment allowance which has been allowed for the assessment year 1977-78 should be considered for the assessment year 1978-79 in case the High Court decides the matter against the assessee and tbe plea of the assessee was accepted. The Income-tax Appellate Tribunal has allowed the plea of the assessee subject to the order of the High Court in respect of the reference pending for the year 1977-78. At this stage, we have only to see as to whether a question of law arises out of the order of the Tribunal or not. Section 32A of the Income-tax Act, 1901, which allows investment allowance provides the conditions for granting such allowance. Without going into the merits of the case, it would be sufficient to observe that the order of the Income-tax Appellate Tribunal considering such a deduction for the assessment year 1978-79 conditionally requires the interpretation of the provisions of Section 32A of the Act and, therefore, a question of law does arise. In these circumstances, the Income-tax Appellate Tribunal is directed to state the case and to refer the above question of law for decision of this court within four months from the date of receipt of a copy of this order. No order as to costs.;