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Commissioner Of Income-Tax v. H.M.T Ltd.
Summary of Opinion — S.P. Bharucha, C.J.
Factual and Procedural Background
The reference was made at the instance of the Revenue and concerns the assessment year 1981–82. The referred question asked whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in upholding the order of the Commissioner of Income-tax (Appeals) who directed the Inspecting Assistant Commissioner to include the value of capital work-in-progress and plant and machinery in transit in the computation of capital. Counsel for the parties agreed on the answer in view of an earlier judgment of this Court. The Court answered the question accordingly.
Legal Issues Presented
- Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in upholding the order of the Commissioner of Income-tax (Appeals) who directed the Inspecting Assistant Commissioner to include the value of capital work-in-progress and plant and machinery in transit in the computation of capital?
Arguments of the Parties
The opinion does not contain a detailed account of the parties' legal arguments.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Ravi Machine Tools (P.) Ltd. v. CIT, [1978] 114 ITR 459 | Authority relied upon to answer the reference in the assessee's favour | The Court relied on this judgment and, in view of it, answered the referred question in the affirmative and in favour of the assessee. |
Court's Reasoning and Analysis
The Court's analysis as set out in the opinion is concise. The procedural posture and the precise question were stated. Counsel for the parties agreed that the question should be answered affirmatively and in favour of the assessee. That agreement was grounded on the Court's earlier decision in Ravi Machine Tools (P.) Ltd. v. CIT, [1978] 114 ITR 459. Accordingly, the Court adopted that position and resolved the reference by answering the question in the affirmative.
Holding and Implications
Answered in the affirmative and in favour of the assessee.
Direct effect: The Court's answer affirms that the Appellate Tribunal was right in law in upholding the Commissioner of Income-tax (Appeals)'s direction to include the value of capital work-in-progress and plant and machinery in transit in the computation of capital for the assessment year in question. The opinion relies on the cited precedent (Ravi Machine Tools) and does not set out broader new principles beyond applying that precedent.
S.P Bharucha, C.J:— The reference is made at the instance of the Revenue. It relates to the assessment year 1981–82.
2. The question that is referred reads thus:
“Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in upholding the order of the Commissioner of Income-tax (Appeals) who directed the Inspecting Assistant Commissioner to include the value of capital work-in-progress and plant and machinery in transit in the computation of capital?”
3. Counsel are agreed that the question must be answered in the affirmative and in favour of the assessee in view of the judgment of this court in Ravi Machine Tools (P.) Ltd. v. CIT, [1978] 114 ITR 459.
4. The question is so answered.
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