COMMISSIONER OF INCOME TAX Vs. MODI INDUSTRIES LTD

JUDGEMENT

(1.) IN respect of the asst. year 1966 -67, the petitioner seeks a direction under S. 256(2) of the IT Act, 1961, to the effect that the Tribunal should be required to state the case and refer the following question to this Court :

(2.) IT appears that in respect of the asst. year 1964 -65, the payment made to M/s Standard Electrode Corporation was disallowed by the ITO and that was upheld in appeals up to the Tribunal. In respect of the asst. year 1965 -66 also, there was part disallowance which was upheld by the Tribunal. At the request of the assessee, the Allahabad High Court under S. 256(2) of the Act called for reference of two questions and the same is pending in that Court.

(3.) WHEN the matter came up in appeal before the Tribunal, it was noticed by the Tribunal that in respect of the asst. year 1964 -65, penalty proceedings had been initiated against the assessee. During those penalty proceedings, further material had been placed by the assessee and on the basis of that further material, the Tribunal had observed that no penalty was leviable, inter alia, for the reason that the payments to M/s Standard Electrode Corporation had been made by cheques and there was evidence on record to show that services had been rendered by M/s Standard Electrode Corporation to the assessee -company. The Tribunal took into consideration the papers which had been filed by the assessee the details of which, as, per the order of the Tribunal, are as follows :