COMMISSIONER OF INCOME TAX Vs. GOKAK MILLS LTD

JUDGEMENT

(1.) The following three questions stand referred to us for our opinion :

(2.) Broadly stated, in these questions we are concerned with the following funds :

(3.) In case of this very assessee we have earlier determined IT Reference No. 153 of 1971. In the said reference, earlier decided by us on 24-8-181, we have dealt with provisions made for Staff Gratuity Contingencies, Freight, Rebate etc. and proposed dividend. We have referred to the decisions, both of the Supreme Court and of this Court which would govern the answers to be given to the questions referred to us. It would appear to us that it is unnecessary in this matter to discuss the facts elaborately. It would appear that the position is covered, as far as this Court is concerned for the dividend reserve amount by the decision of this Court in Shreeram Mills Ltd. v. CIT, Bombay City-I, 1977 CTR (Bom) 69; (1977) 108 ITR 27 (Bom). Similarly, as far as the third question is concerned the position is concluded by the decision of the Supreme Court in CIT v. Mysore Electrical Industries Ltd. (1971) 80 ITR 566 (SC). Accordingly, we propose to answer the question as follows :