COMMISSIONER OF INCOME TAX Vs. V P JAIN

JUDGEMENT

(1.) AT the instance of the Revenue, the Tribunal, New Delhi, has referred, under s. 256(1) of the IT Act, 1961, (for short the Act), the following question for the opinion of this Court :

(2.) ALTHOUGH the Revenue has failed to file the paper books as well as the annexures to the statement of the case but keeping in view the fact that the issue involved in the case is purely legal, we dispense with the filing of the paper book and proceed to dispose of the reference.

(3.) THERE has been a divergence of opinion on the issue between various High Courts. The Allahabad and the Bombay High Courts have taken the view that in such a situation partners would be entitled to the exemption, whereas the Madhya Pradesh High Court has taken a contrary view. It is, however, submitted by learned counsel for the Revenue that in view of the insertion of sub-S. 3 in S. 80L by the Taxation Laws (Amendment) Act, 1984 with retrospective effect from 1st April, 1976, it is not necessary for us to examine the issue in the light of the opinion expressed by various Courts. It is urged that in view of the said insertion, which has been made applicable with retrospective effect from 1st April, 1976, deduction under s. 80L cannot be allowed to the partners of a firm at least from asst. yr. 1976-77. It is asserted that since in the instant case, the assessment year involved is asst. yr. 1976-77, the respondent-assessee would not be entitled to deduction under the said section.