COMMISSIONER OF INCOME TAX CHENNAI VIII Vs. KANCHIPURAM ANNA SILK HANDLOOM WEAVERS CO OPERATIVE P AND S SOCIETY LIMITED

JUDGEMENT

(1.) THE Revenue is on appeal as against the common order passed by the Income Tax Appellate Tribunal relating to assessment years 1993-94 to 1996-97. THE following common substantial questions of law were raised for consideration in this Tax Case Appeal.

(2.) THE assessee herein is a co-operative society engaged in the production and sale of Kancheepuram Silk Sarees woven by members. THE assessee herein invested its funds in various Government securities viz., Kisan Vikas Patra, Indra Vikas Patra etc. as directed by the Deputy Director of Handlooms and Textiles, Kancheepuram on the orders received from the District Collector. THE said direction was given in the context of the assessee claiming credit facility from the Central Government and the State Government with reference to the business activities. Thus, to make their investments in these Government securities, the assessee borrowed money from the bank. On the interest derived on these investments, which were made out of business compulsion, the assessee claimed that they were attributable to the business. Consequently, the assessee was entitled to the benefit of Section 80P(2) of the Income Tax Act. THE assessee filed a petition under Section 154 of the Income Tax Act for rectification of the order passed under Section 143(3) read with 250 of the Income Tax Act, by placing reliance on the decision of the Apex Court reported in 251 ITR 13 " CIT v. KARNATAKA STATE CO-OPERATIVE APEX BANK LIMITED and 251 ITR 194 " CIT v. KARNATAKA STATE CO-OPERATIVE APEX BANK LIMITED. THE said claim was however rejected by the Officer on the ground that the decision referred to would not be of any help to the assessee since there were conflicting decisions.

(3.) AS far as the first question of law as to the invoking of jurisdiction under Section 154 of the Act is concerned, learned standing counsel stated before this Court that in the light of the decision of the Apex Court reported in251 ITR 13 " KARNATAKA CO-OPERATIVE APEX BANK LIMITED, there cannot be any dispute for rectifying the mistake apparent on the face of the order. Learned standing counsel for the Revenue submitted that the Revenue has no serious dispute to be argued as regards the jurisdiction aspect under Section 154 of the Act. Thus recording the said statement of the learned Standing Counsel, the first question is answered against the Revenue.