COMMISSIONER OF INCOME TAX vs. BHARAT VIJAY CONSTRUCTION CO

ITR/309/1987HC GujaratGJHC24012039198719 July 2001Author: HONOURABLE MR. JUSTICE ANIL R. DAVE,HONOURABLE MR. JUSTICE D.A.MEHTA2 pages
AI SummaryDismissed

What were the facts?

This case involves an Income Tax Reference filed by the Revenue (Commissioner of Income Tax) at the instance of the Income Tax Appellate Tribunal, Ahmedabad Bench 'A'. The reference pertains to the assessment year(s) not explicitly stated but relates to a decision by the Tribunal concerning the assessee, Bharat Vijay Construction Co. The specific action under challenge is the Tribunal's conclusion that the assessee was entitled to an investment allowance of Rs. 51,891/- under Section 32A of the Income-tax Act, 1961. The procedural history involves the Tribunal referring a question of law to the High Court for its opinion under Section 256(1) of the Act. The Revenue was represented by its counsel, while the assessee, though served, did not appear.

What did the High Court hold?

The High Court held that the question referred to it had already been answered by the Hon'ble Supreme Court in the case of CIT v. N.C. Budharaja & Co. & Anr., reported in 204 ITR 412. Based on the law laid down by the Supreme Court in that precedent, the High Court answered the question in the negative, meaning the decision was against the assessee and in favour of the Revenue. Therefore, the assessee was not entitled to the investment allowance of Rs. 51,891/- under Section 32A of the Act. The reasoning is that the Supreme Court's ruling on a similar issue dictated the outcome. The ratio decidendi is that if a binding precedent exists, it must be followed. The reference was disposed of accordingly, with no order as to costs. No issue was expressly left undecided.

What were the issues?

The Tribunal had to decide the following question of law: 1. Whether on the facts and in the circumstances of the case, the Tribunal was right in law in coming to the conclusion that the assessee is entitled to investment allowance of Rs. 51,891/- under Section 32A of the Act? Contentions: Assessee: The judgment does not record any contentions made by the assessee. The assessee did not appear before the High Court. Revenue: The Revenue, through its counsel, presented the question of law for the High Court's opinion. The Revenue's implicit contention, as revealed by the court's decision, is that the assessee was not entitled to the investment allowance.

Which sections of the Income-tax Act were involved?

Section 256(1),Section 32A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

INCOME TAX REFERENCE No 309 of 1987

For Approval and Signature:

Hon'ble MR.JUSTICE A.R.DAVE and Hon'ble MR.JUSTICE D.A.MEHTA

============================================================ 1. Whether Reporters of Local Papers may be allowed : NO to see the judgements?

2.

To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement?

4.

Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder?

5.

Whether it is to be circulated to the Civil Judge? : NO

The order continues below.

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