S.C : Following the said decision, the question of law referred by the Tribunal in the instant case was answered in favour of the assessee.

JUDGMENT

By the court :

In the instant case the High Court followed its earlier decision in the case of V. Devaki Ammal vs. Asstt. CED (1973) 91 ITR 24 (Mad), in which it had been held that s. 34(1)(c) of the ED Act, 1953, was ultra vires. Following the said decision, the question of law referred by the Tribunal in the instant case was answered in favour of the assessee.

2. The decision of the High Court in V. Devaki Ammal vs. Asstt. CED (supra), came up in appeal and in the judgment Asstt. CED vs. V. Devaki Ammal (1995) 125 CTR (SC) 134 : (1995) 212 ITR 395 (SC), the view of the High Court was reversed and it was held that s. 34(1)(c) of the Act was valid. This being so, the decision of the High Court in the present case has to be set aside and as the High Court did not go into the merits of the question, we remand the case to the High Court for deciding the case afresh in accordance will law. There will be no order as to costs.

[Citation: 236 ITR 44]