COMMISSIONER OF INCOME TAX Vs. ATLAS CYCLE INDUSTRIES

JUDGEMENT

(1.) This is a petition filed by the CIT, Haryana, Rohtak, under s. 256(2) of the IT Act, 1961 (hereinafter referred to as the Act) for the asst. yr. 1978-79 directing the Appellate Tribunal, Delhi B Bench, Delhi (hereinafter referred to as the Tribunal) to refer the following question of law for the opinion of this Court :

(2.) Reference is being made only to those facts which relate to the controversy raised in this petition.

(3.) Contention raised by the counsel appearing for the Revenue is that the rim manufacturing unit of the assessee was an independent unit and while computing its capital the loan taken by it from the cycle unit of the Atlas Cycle Industries was not allowable deduction from the computation of the capital. This point has not been considered by this Court earlier. Question as to whether the capital borrowed by the unit from another unit of the company is to be deducted from the capital employed in the said unit for the purpose of computation of the capital employed under s. 80J, would certainly be a question of law and the Tribunal has wrongly declined to refer the same to this Court for its opinion.