COMMISSIONER OF INCOME-TAX Vs. HAMDARD PRINTING PRESS

JUDGEMENT

(1.) THE matter here relates to the entitlement of the assessee to development rebate.

(2.) THE assessee filed his return of income for the assessment year 1973-74 and claimed therein a development rebate of Rs. 42,353. No reserve account, in which 75 per cent, of this development rebate claimed, could be credited had, however, been created by the assessee, by debiting the profit and loss account for the year. Before the assessment was completed, the assessee filed a revised return in which this reserve was claimed to have been created. Both the Income-tax Officer as also the Appellate Assistant Commissioner, in appeal, disallowed the assessee's claim for development rebate on the ground that at the time of the filing of the first return, the prescribed reserve had not been credited and that the reserve, when credited, was only by debiting the profit and loss account. The Tribunal, however, took a contrary view upholding the assessee's claim for development rebate. It is, in these circumstances, that the following question of law has been referred to this court for its opinion : "whether, on the facts and in the circumstances of the case, the Tribunal was right in finding that the assessee was entitled to development rebate ?"

(3.) KEEPING in view the settled position in law as laid down in C1t v. Haryana State Minor Irrigation and Tubewell Corporation Ltd. [1983] 140 ITR 437 (P and H), that it is open to an assessee to make entries regarding development rebate reserve at any time before the assessment is completed, the question posed has clearly to be answered in the affirmative, in favour of the assessee and against the Revenue. A similar view was also taken in CIT v. Sardar Singh Sachdeva [1972] 86 ITR 387 (P and H), CIT v. Rita Mechanical Works [1977] 108 ITR 552 (P and H) and Aero-polymers (P.) Ltd. v. CIT [1985] 151 ITR 158 (Pandh ).