COMMISSIONER OF INCOME TAX Vs. RAMBAL P LIMITED

JUDGEMENT

(1.) AT the instance of the Revenue, the following tow questions have been referred to this Court for its opinion, as arising out of the order of the Tribunal.

(2.) THE assessee is a private limited company incorporated on 16th June, 1965 and is engaged in the manufacture and sale of bolts, nuts and screws for automobile and for other machinery. During the accounting years ending with 30th June, 1969 and 30th June, 1970, it had installed new machinery of the value of Rs. 1,86,189 and Rs. 2,22,369. It claimed development rebate in respect of such machinery at 35 per cent thereof amounting to Rs. 48,840 for the asst. year 1970 -71 and Rs. 77,490 for the asst. year 1971 -72 under S. (1)(b)(i)(a) of the IT Act. 1961. The ITO held that that assessee would be entitled to development rebate on such machinery at the rate of 20 per cent only on the ground that the relevant machinery had been used not only for the production of nuts, bolts and screws for automobiles but also for the production of other machinery. Hence he allowed development rebate of Rs. 37,238 for the asst. year 1970 -71 and Rs. 44,280 for the asst. yr. 1971 -72. The assessee also claimed the benefit of deduction allowable under S. 80 -I of the Act for the asst. year 1970 -71 of a sum of Rs. 4,800 and for the asst. year 1971 -72 of a sum of Rs. 29,258. The ITO observed that form the accounts maintained by the assessee it was not possible to separate the income form the manufacture and sale of bolts, nuts and screws for the automobile ancillaries and the income derived from the manufacture and sale of such bolts, nuts, and screws for other machinery. Hence, he rejected the claim under S. 80 -I for the asst. year 1970 -71 he gave an additional reason that since the total income for that year was determined as nil deduction permissible under S. 80 -I could not be given. Aggrieved by those assessments, the assessee preferred appeals to the AAC, who accepted the assessee claims for both the assessment years under consideration.

(3.) WE find that the first question of law stated above is covered by a decision of this Court in the assessee's own case in Addl. CIT vs. Rambal (P) Ltd. (1980) 123 ITR (Mad) relating to an earlier year, which is against the Revenue. Therefore, that decision rendered in the assessee's own case should govern the first question here. Question No. 1 is therefore, answered against the Revenue.