COMMISSIONER OF INCOME TAX Vs. LUCAS TVS LIMITED

JUDGEMENT

(1.) THE ITO excluded a sum of Rs. 7.22 lakhs representing the amount said to be outstanding to Messrs. Joseph Lucas (Industries) Limited, England, on plant account in the computation of capital for the purpose of relief under. 80J for the assessment year 1968-69.

(2.) FOR the assessment year 1972-73, the assessee claimed a deduction of Rs. 14,52,466 as representing the gratuity liability. The ITO allowed deduction only to the extent of Rs. 4,65,944 and disallowed the balance of the claim on the ground that the payment of the said sum had not arisen during the assessment year in question.

(3.) THE learned counsel for the Revenue also refers to regulation 18 of the Regulation for Management of a Company Limited by Shares, which provides for payment of interest on advance share money in support of his plea that the amount payable for the plant and machinery by the company can be taken to be a debt. THE said regulation 18 is as follows :