COMMISSIONER OF INCOME TAX Vs. KOVUR TEXTILES LIMITED

JUDGEMENT

(1.) THIS reference is made at the instance of the Commissioner of Income-tax under s. 256(1) of the I.T. Act, 1961 (43 of 1961), for opinion of this court on the following questio :

(2.) THE assessee is a limited company. It had contributed to a "chit fund" known as Rajarajeswari Financiers for Rs. 25,000 and by September, 1969, had paid eleven instalments. Finally, the company did the chit for Rs. 20,000 on June 20, 1970. THE company by that date had paid eleven instalments and had executed a promissory note for Rs. 14,000. In the further facts found, the company as per accounts of the chit fund had received Rs. 1,437 as discount money in the bids made by other contributors.

(3.) ON the above facts, the question referred can be and is answered only in the affirmative, in favour of the assessee and against the revenue. No order as to costs.