STATE OF GUJARAT Vs. DADUBHAI BHANBHAI JABALIA

JUDGEMENT

(1.) The Income-tax Appellate Tribunal, Ahmedabad Bench "B" has referred the following question under Section 256 (1) of the Income-tax Act, 1961 ("the Act") at the instance of Revenue :

(2.) The Assessment Year 1985-86 and the relevant Accounting period is year ending 30.6.1984. The Assessee, a registered Firm, claimed deduction of royalty paid to the Government on the basis of mercantile system of accounting by debiting appropriate amount in the accounts. The deduction was disallowed by the Assessing Officer by invoking the provisions of Section 43-B of the Act qua unpaid royalty amount. The Commissioner (Appeals) deleted the addition and hence the Revenue carried the matter in Appeal before the Tribunal. The Tribunal upheld the order made by the Commissioner (Appeals) on the basis of its earlier order in the case of another assessee - one Gujarat State Forest Development Corporation.

(3.) Mr. M.R.Bhatt, learned Senior Standing Counsel for the Applicant Revenue fairly pointed out that the issue now stands concluded against Revenue by virtue of Judgment of the Apex Court in the case of STATE OF WEST BENGAL & ANR. V/s. KESORAM INDUSTRIES LTD. & OTHERS, reported in (2004) 266 ITR 721, with special reference to the observations from Page No.762 onwards.