COMMISSIONER OF INCOME-TAX Vs. L D SATIJA

JUDGEMENT

(1.) CIT submitted an application under s. 256 (1) of the IT Act, 1961, before the Tribunal with the request that the following question of law arising out of order dt. 17th January, 1997, be referred to the High Court for opinion : "whether, on the facts and in the circumstances of the case, the Hon'ble Tribunal was right in law in deleting the disallowance/adjustment of Rs. 48,834 out of additional conveyance allowance by holding that this adjustment was not permissible under s. 143 (1) (a) ? " The Tribunal having rejected this application, the Revenue has approached this Court through the present petition.

(2.) A few facts may be noticed : On 4th July, 1994, the assessee filed an income-tax return disclosing income of Rs. 3,40,370. He claimed a deduction of Rs. 99,234, which had been paid to him on account of conveyance allowance and additional conveyance allowance. The assessing authority processed the return under s. 143 (1) (a) of the IT Act. It allowed a deduction of Rs. 50,400 on account of conveyance allowance and additional conveyance allowance. However, it added back an amount of Rs. 48,834 out of the additional conveyance allowance. Aggrieved by the order, the assessee filed an appeal which was dismissed by the CIT (A ). The assessee approached the Tribunal. Vide order dt. 17th January, 1997, the Tribunal accepted the assessee's appeal and held that the assessment having been framed under s. 143 (1) (a) of the Act, and no opportunity having been afforded to the assessee, the ITO was not entitled to add back the amount of Rs. 48,834. Thereafter, the Revenue's application for reference having been rejected, it has approached this Court.

(3.) Mr. R. P. Sawhney, learned counsel for the Revenue, contends that the question of law, as framed by the CIT, arises in the circumstances of this case. Consequently, it should be called for the opinion of this Court. He further states that the issue has, in fact, been settled in IT Ref. No. 562 and 565 of 1995, decided on 22nd December, 1998. He contends that it was held by the Bench that the action of the assessing authority in allowing the deduction partly on the basis of the certificate given by the LIC was valid.