COMMISSIONER OF INCOME-TAX VS JAISWAL CHEMICALS (P.) LTD.
2001 P T D 2624
[248 I T R 106]
[Supreme Court of India]
Present: B.N. Kirpal and S. Rajendra Babu, JJ
COMMISSIONER OF INCOME‑TAX
versus
JAISWAL CHEMICALS (P.) LTD.
Civil Appeals Nos.5671 and 5672 with 5673 of 1999, decided on 06/10/1999.
(Civil Appeals Nos.5671 and 5672 of 1999 are by special leave from the orders, dated April 17, 1998, of the Bombay High Court in I.T.A. No. l l of 1995 and I. T. A. No.43 of 1995).
(a) Income‑tax‑‑‑
‑‑‑‑Reference‑‑‑Question of law‑‑‑Investment deposit account‑‑‑Allowable deduction‑‑‑ Interest income‑‑‑Whether can be treated as eligible profits‑‑ Interest earned out of monies invested in short‑term deposits‑‑‑Whether eligible‑‑‑Are questions of law‑‑‑Indian Income Tax Act, 1961, S_s.32AB & 256(2).
(b) Income‑tax‑‑‑
‑‑‑‑Reference‑‑‑Question of law‑‑‑New industrial undertakings‑‑‑Computation of profits and gains derived from‑‑‑Interest whether could be included‑‑‑Is a question of law‑‑‑Indian Income Tax Act, 1961, S9.80‑I & 256(2).
The question whether relief under section 32AB of the Income Tax Act, 1961, in relation to amounts deposited in the investment deposit account should also be granted on the interest component of the income earned out of monies invested in short‑term deposits is a question of law.
The question whether interest income can be treated as eligible profits of the business while computing the deduction under section 32AB is a question of law.
The question whether, while computing relief under section 80‑1 of the Income Tax Act, 1961, interest income should be added in the gross total income is a question of law.
K.N. Raval, Additional Solicitor‑General (Hemant Sharma and S.K. Dwivedi, Advocates with him) for Appellant.
ORDER
C.A. Nos.5671 and 5672 of 1999 at S.L.P. (C.) Nos. 8892 and 8893 of 1999:
Leave granted: After hearing learned counsel for the appellant, in our opinion, questions of law did arise. We, therefore, allow this appeal and direct the Tribunal to state the case and refer the following two questions of law to the High Court:
"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in upholding' the Commissioner of Income‑tax (Appeals) in directing the Assessing Officer to treat the interest income as eligible profits of the business while computing the deduction under section 32AB of the Act?,.
Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in upholding the order of the Commissioner of Income‑tax (Appeals) in directing the Assessing Officer to include the interest income in the gross total income while computing the relief under section 80‑I of the Act?"
There will be no order as to costs.
C.A. No. 5673 of 1999 at S.L.P. (C) No.9107 of 1999:
Special leave‑ granted. After hearing learned counsel for the appellant, in our opinion, a question of law did arise. We, therefore, allow this appeal and direct the Tribunal to state the case and refer the following question of law to the High Court:
"Whether, on the facts and in the circumstances of the case, the Income‑tax Appellate Tribunal was justified in upholding the order of the Commissioner of Income‑tax (Appeals) in granting relief to the assessee under section 32AB of the Income Tax Act, 1961, on the interest component of the income earned out of the monies invested in short term deposits for the assessment year 1990‑91?"
There will be no order as to costs.
M.B.A./938/FCLeave granted.