COMMISSIONER OF INCOME-TAX VS MADRAS AUTO SERVICE P. LTD.
1995 PTD 166
[Supreme Court of India]
Present: M. N. Venkatachaliah and G. N. Ray, JJ.
COMMISSIONER OF INCOME-TAX
Versus
MADRAS AUTO SERVICE P. LTD.
(and other appeals)
Civil Appeal No. 6065 of 1983 with Civil Appeals Nos. 1238 to 1240 and 1348 of 1980; 2288 of 1981; 5906 to 5909, 5913 and 5914, 5934 and 5935, 6071, 6597 and 6598, 6601, 8361 and 8362 and 8582 to 8587 of 1983; 1727 and 1728, 2326 to 2329, 3495 and 3496, 3900, and 3901, and 4584 to 4587 of 1984; 351 and 1186 of 1987 and 4026 to 4028 of 1989, decided on 07/01/1993.
(Civil Appeal No.6065 of 1985 is against the judgment and order dated November 17, 1981, of the Madras High Court in Tax Case No.955 of 1977. The judgment of the High Court is reportedas CIT v. Madras Auto Service P Ltd. (1985) 156 ITR 828 (Mad.))
Income-tax---
----Income-tax company---Surtax---Computation of capital---Deductions in respect of donations interest on certain securities and dividends and intercorporate dividends not to be taken into account to diminish capital---Indian Companies (Profits) Surtax Act, 1946, Sched. II, R.4---Indian Income Tax Act, 1961, Ss.80G, 80L & 80M.
From the decision of the Madras High Court in CIT v. Madras Auto Service P. Ltd. (1985) 156 ITR 828 to the effect that the amounts deducted under the provisions of section 80G (donations), section 80L (interest on certain securities and dividends) and section 80M (inter-corporate dividends) of the Income Tax Act, 1961, formed part of the total income of the respondent company and the capital of the company was not to be reduced by the amounts referable to such deductions under rule 4 of the Second Schedule to the Companies, (Profits) Surtax Act, 1964, the Department preferred an appeal to the Supreme Court. The Supreme Court dismissed the appeal along with other similar appeals.
Second ITO v. Stump. Schuele and Somappa P. Ltd. (1991) 187 ITR 108 (SC) applied.
CIT v. Madras Auto Service P. Ltd. (1985) 156 ITR 828 affirmed on this point.
The Supreme Court also did not entertain any contention suggesting infirmities in the reasoning of the judgment in Second ITO v. Stumpp, Schuele and Somappa P. Ltd. (1991) 187 ITR 108 (SC) because it was as important that the law be certain as it was that it be correct.
ORDER
All these matters are covered by the pronouncement of this Court in Second ITO v. Stumpp, Schuele and Somappa P. Ltd. (1991) 187 ITR 108.
We do not consider it necessary or appropriate to entertain any contention suggesting that the reasoning in the said judgment suffers from infirmities. It is as important that the law be certain as it is that it be correct. These appeals are, accordingly dismissed, but without any order as to costs.
M.B.A./250/T.F. Appeals dismissed.