COMMISSIONER OF INCOME TAX Vs. MGF INDIA LTD

JUDGEMENT

(1.) MAINLY three questions have been raised with regard to the claim of higher rate of depreciation on the vehicles given on lease, the taxability of interest of Rs. 72,19,086 on Zero Coupon Bonds as it was shown in the books of accounts of the assessee and the question whether retrenchment compensation paid to workmen would be admissible for the benefits under the IT Act as business expenditure when there was a closure of one type of business of the assessee.

(2.) AS regards the 3rd question, the assessee was maintaining common books of accounts and funds were common for running different businesses. We were taken through the decisions of the Supreme Court in the cases of CIT vs. Prithvi Insurance Co. Ltd. (1996) 62 ITR (Sh.N) 38/(1967) 63 ITR 632 (SC) and Standard Refinery and Distillery Ltd. vs. CIT (1971) 79 ITR 9 (SC) and Standard Refinery and Distillery Ltd. vs. CIT (1971) 79 ITR 589 (SC) and in view of the apex Court judgment, it would not be possible to say that the Tribunal has committed any error insofar as the allowance of retrenchment compensation as a business expenditure is concerned.