Supreme Court Of India
CIT vs. Allied Chemicals Corporation
Sections 57(i), 256(2)
S.P. Bharucha & B.N. Kirpal, JJ.
Civil Appeal No. 642 of 1979
6th February, 1996
B.B. Ahuja with S.N. Terdol & S. Rajappa, for the Appellant : H.S. Parihar, for the Respondent
BY THE COURT :
This is an appeal by special leave against the order of the High Court at Bombay, rejecting an income-tax application filed by the Revenue.
2. The Revenue, by the income-tax application, asked the High Court to direct the Tribunal to refer to it, under s. 256(2) of the IT Act, 1961, the following question :
“Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the amount of Rs. 34,575 representing a loss that arose to the assessee at the time of remittance of money to it was an allowable deduction under s. 57(i) of the IT Act, 1961 ?”
The High Court declined to do so, saying only, “rejected”. Plainly, the question sought to be referred is a question of law concerning the interpretation of s. 57(i) of the IT Act and the High Court ought to have called for a reference from the Tribunal concerning it.
The appeal is allowed. The Tribunal is directed to refer the aforequoted question to the High Court under s. 256(2) of the Act. There shall be no order as to costs.
[Citation: 236 ITR 304]