COMMISSIONER OF INCOME TAX CENTRAL Vs. ROHTAS INDUSTRIES LTD

JUDGEMENT

(1.) In this reference, under Section 256(1) of the LT. Act, 1961, the following question has been referred to this court :

(2.) It is necessary to appreciate this question to refer to certain facts. It appears that in the regular assessment, the ITO had allowed depreciation amounting to Rs. 64,57,633. This reference relates to the assessment for the assessment year 1962-63 for which the previous year ended on 31st March, 1962. Under Section 154 of the I.T. Act, 1961, the ITO had rectified the assessment order and reduced the depreciation to Rs. 62,02,200. Thus, he withdrew the depreciation allowable to the extent of Rs. 2,55,433. The details are in the order of the Appellate Tribunal. We are not concerned with all the items. We are only concerned with one item, viz., the rebate recoverable from the foreign supplier, which amounted to Rs. 41,309. The AAC had allowed this item in favour of the assessee. There were appeals both by the revenue as well as the assessee. We are not concerned with the other items. So far as the revenue's appeal about Rs. 41,309 is concerned, it was submitted before the Tribunal that the AAC was not justified in allowing the depreciation on that item. The Tribunal was, however, unable to agree with the submission. In the earlier years, the Tribunal had considered the same point and had held against the revenue and the Tribunal therein had observed, inter alia, as follows ;

(3.) The Tribunal noted that it was held by the Tribunal that there was no justification in reducing the depreciation and development rebate on account of rebate received by the assessee. Therefore, the Tribunal upheld the order of the AAC and the appeal preferred by the revenue was dismissed.