SYNBIOTICS LIMITED vs. ASST. CIT
What did the High Court hold?
The High Court decided not to take a different view from its previous ruling in a similar case. The Court referred to its own decision in Synbiotics Limited v. Dy. Commissioner of Income Tax and Others dated 09.04.2009 in Tax Appeal No.380/1999, which involved identical facts and questions of law. Based on this precedent, the High Court held that the questions raised in the present appeals should be answered in favour of the assessee and against the revenue. Consequently, the disallowance of deductions made by the Tribunal was overturned. The operative direction was to dispose of the appeals accordingly, implying that the deductions claimed by the assessee were to be allowed. No issue was expressly left undecided.
What were the facts?
The appellant, Synbiotics Limited, filed these appeals challenging the judgment and order of the Income Tax Appellate Tribunal (ITAT), Ahmedabad 'C' Bench. The appeals pertain to assessment years 1985-86, 1986-87, and 1987-88. The core of the dispute involves the disallowance of deductions claimed by the assessee for amounts payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979. The amounts in dispute are Rs. 4,41,46,682/- for AY 1985-86, Rs. 2,90,34,720/- for AY 1986-87, and Rs. 13,01,844/- for AY 1987-88. The High Court admitted these appeals by framing substantial questions of law.
What were the issues?
1. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in confirming the disallowance of deduction of Rs. 4,41,46,682/- payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979 (for AY 1985-86)? 2. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in confirming the disallowance of deduction of Rs. 2,90,34,720/- payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979 (for AY 1986-87)? 3. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in confirming the disallowance of deduction of Rs. 13,01,844/- payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979 (for AY 1987-88)? Assessee's Contention: The judgment does not record specific contentions made by the assessee. However, the framing of the questions implies that the assessee argued for the allowability of the deduction. Revenue's Contention: The revenue contended that the questions raised in these appeals should be answered against the assessee, relying on the decision of the same High Court in Synbiotics Limited v. Dy. Commissioner of Income Tax and Others dated 09.04.2009 in Tax Appeal No.380/1999, where the facts and questions of law were identical.
AI-generated summary — verify with the full judgment below
O/TAXAP/250/2005 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 250 of 2005 With TAX APPEAL NO. 251 of 2005 With TAX APPEAL NO. 253 of 2005
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE KS JHAVERI Sd/-
and HONOURABLE MR.JUSTICE K.J.THAKER Sd/-
================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? No 2 To be referred to the Reporter or not ? No 3 Whether their Lordships wish to see the fair copy of the judgment ? No 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? No 5 Whether it is to be circulated to the civil judge ? No ================================================================ SYNBIOTICS LIMITED....Appellant(s) Versus ASST. CIT....Opponent(s) ================================================================ Appearance: NOTICE SERVED for the Appellant(s) No. 1 MRS MAUNA M BHATT, ADVOCATE for the Opponent(s) No. 1 Page 1 of 4
O/TAXAP/250/2005 JUDGMENT ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER
Date : 17/10/2014
COMMON ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1.By way of these Appeals, the appellant has challenged the judgment and order of the Income Tax Appellate Tribunal, Ahmedabad 'C' Bench passed in :- Tax Appeal No. Income Tax Appeal Assessment Year 250/2005 76/AHD/1990 1985-86 251/2005 77/AHD/1990 1986-87 253/2005 513/AHD/1991 1987-88 2.While admitting the matter on 27.10.2005, the following substantial questions of law were framed in :- Tax Appeal No.250/2005 “Whether, on the facts and in the circumstances of the case, the Tribunal is justified in confirming the disallowance of deduction of Rs.4,41,46,682/- payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979?” Tax Appeal No.251/2005 “Whether, on the facts and in the circumstances of the case, the Page 2 of 4
O/TAXAP/250/2005 JUDGMENT Tribunal is justified in confirming the disallowance of deduction of Rs.2,90,34,720/- payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979?” Tax Appeal No.253/2005 “Whether, on the facts and in the circumstances of the case, the Tribunal is justified in confirming the disallowance of deduction of Rs.13,01,844/- payable to the Drug Prices Equalization Account under the Drugs (Price Control) Order, 1979?” 3.Learned Counsel for the respondent contended that the questions raised in these Appeals are required to be answered against the Assessee in view of the decision of this Court (Synbiotics Limited v. Dy. Commissioner of Income Tax and Others) dated 09.04.2009 in Tax Appeal No.380/1999 wherein facts and questions of law are identical. 4.We do not think that we should take a different view in the facts of these cases. The Appeals stand disposed of accordingly, answering the questions in favour of assessee and against revenue in all these matters. Sd/- (K.S. JHAVERI, J.) Page 3 of 4
O/TAXAP/250/2005 JUDGMENT Sd/- (K.J. THAKER, J) CAROLINE Page 4 of 4
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