COMMISSIONER OF INCOME TAX Vs. HIMACHAL ENGG. CO. (P) LTD.

JUDGEMENT

(1.) BY this common judgment, we dispose of all the aforesaid income tax references since a common question of law is involved therein.

(2.) THE main question which has been referred for opinion of this Court by the Tribunal reads as follows:

(3.) THIS Court in CIT v. Ruchira Papers Ltd. (1994) 208 ITR 601 (HP), had followed the decision of the Madras High Court Sirinivas Industries v. CIT and it came to the conclusion that the actual cost of assets cannot be reduced by subsidy received. In fact this question has been settled by the apex Court in CIT v. P.J. Chemicals Ltd. , wherein the apex Court after considering the entire law and the authorities of the various High Courts, has decided the matter against the Revenue and upheld the judgment of the Madras High Court which was relied upon (sic) by the apex Court. The apex Court specifically set aside the judgment rendered by the Punjab & Haryana High Court relied by the Tribunal. The apex Court held as follows: