COMMISSIONER OF INCOME TAX Vs. KAMALPUR ASSAM TEA ESTATE P LIMITED

JUDGEMENT

(1.) THE Tribunal, Gauhati Bench (hereinafter referred to as "the Tribunal"), has referred to the High Court the following question of law under S. 256(1) of the IT Act, 1961 (hereinafter referred to as "the Act") :

(2.) THE facts leading to the question of law may briefly be stated as follows : The relevant asst. yr. is 1963 -64. The assessee purchased a dryer as per bill dated August 14, 1961, and the actual cost came to Rs. 1,03,095. The accounting period of the assessee is the calendar year and in the asst. yr. 1962 -63, the total income of the assessee was calculated at Rs. 4,706 and he has shown the net profit as per profit and loss account at Rs. 5,065. The assessee calculated the development rebate allowable for Rs. 1,03,095 at Rs. 25,774 and the statutory reserve required was 75per cent which came to Rs. 19,330 and, therefore, in the asst. year 1962 -63, the assessee did not create the necessary reserve for development rebate. In the asst. year 1963 -64, the assessee created the development reserve to the extent of Rs. 20,000. The assessee thus claimed rebate at least to the extent of Rs. 20,000 minus Rs. 4,706, that is to say, the assessee claimed development rebate in the asst. year 1963 -64, to the extent of Rs. 15,913. The ITO did not allow the development rebate to the assessee in respect of the dryer as the same was installed and brought to use in 1961.

(3.) THE assessee then preferred an appeal before the Tribunal. Regarding the development rebate with respect to the dryer the Tribunal held that the assessee was entitled to a development rebate to the extent of Rs. 20,000 minus Rs. 4,706, that is to say, to the extent of Rs. 15,913.