S.C : Whether, on the facts and in the circumstances of the case, the Tribunal was right in directing the AO to allow deduction of service charges amounting to Rs. 1,82,03,470 or any part thereof ?

Supreme Court Of India

CIT vs. Balaji Enterprises

Section 256(2)

B.N. Kirpal & N. Santosh Hegde, JJ.

Civil Appeal No. 4413 of 2001

20th July, 2001

Counsel Appeared

Ms. A. Subhashini & B.V.B. Das, for the Appellant : V. Ramachandran with P. Venugopal, P.S. Sudheer & Ms. Surekha Raman for K.J. John & Co., for the Respondent

ORDER

BY THE COURT :

Special leave granted.

2. After hearing the counsel for the parties, in our opinion, a question of law does arise, especially in view of the fact that the Madras High Court in CIT vs. Balaji Enterprises (1999) 236 ITR 589 (Mad) in a case of the respondent relating to a similar claim for deduction had allowed the application under s. 256(2) of the IT Act, 1961. We, therefore, allow this appeal, set aside the judgment of the High Court and direct the Tribunal to state the case and refer the following question of law to the High Court :

“Whether, on the facts and in the circumstances of the case, the Tribunal was right in directing the AO to allow deduction of service charges amounting to Rs. 1,82,03,470 or any part thereof ?”

[Citation : 254 ITR 553]

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