COMMISSIONER OF INCOME TAX Vs. PAUSHAK LIMITED

JUDGEMENT

(1.) THE following two questions have been referred by the Tribunal, Ahmedabad, for the opinion of this Court under S. 256(1) of the Income tax Act, 1961 :

(2.) THE matter pertains to asst. year 1977 78. The ITO had allowed certain benefits to the assessee under various provisions of the Act in his order dt. 30th April, 1979. The assessee preferred an appeal and the CIT(A) partly allowed the same by his order dt. 12th Nov., 1980. However, another CIT proceeded under S. 263 of the Act and by his order dt. 27th April, 1981, directed that the deduction under S. 80HH to the tune of Rs. 1,91,303 and the deduction under S. 35(1) allowed by the ITO to the extent of Rs. 94,669 on account of expenditure incurred in the earlier years on scientific research, should be withdrawn and the assessee's claim for depreciation on the written down value (WDV) of the plant and machinery be recomputed and allowed after deducting the value of subsidy received and that the excess amount paid over WDV on plant and machinery purchased from the holding company shall be deducted before allowing depreciation. Against that order the assessee appealed to the Tribunal and the Tribunal allowed the appeal holding that the entire order of the ITO had merged in the appellate order of the CIT(A) which was made on 12th Nov., 1980 and therefore, the order made by the CIT under S. 263 on 27th April, 1981 was invalid.

(3.) UNDER the above circumstances, both the questions referred to us are answered in the negative in favour of the Revenue and against the assessee. The reference stands disposed of accordingly with no order as to costs.