S.C : Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that for purposes of computation of the intrinsic value of unquoted shares under r. 1D of the WT Rules, the amount of advance tax paid by the company and shown on the asset aside of the balance sheet should not be deducted from the tax payable in determining whether the provision for tax was in excess over the tax payable with reference to the book profits in accordance with the law applicable thereto within the meaning of cl. (ii)(e) of the Explanation to the said rule ?

Counsel Appeared

K.N. Shukla with K.C. Kaushik & B.V.B. Das for Ms. Sushma Suri, for the Appellant : None, for the Respondent

ORDER

BY THE COURT :

The assessee has been served but has not chosen to put in an appearance.

2. The question before the High Court at the behest of the Revenue read thus :

“Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that for purposes of computation of the intrinsic value of unquoted shares under r. 1D of the WT Rules, the amount of advance tax paid by the company and shown on the asset aside of the balance sheet should not be deducted from the tax payable in determining whether the provision for tax was in excess over the tax payable with reference to the book profits in accordance with the law applicable thereto within the meaning of cl. (ii)(e) of the Explanation to the said rule ?”

The High Court answered the question in favour of the assessee relying upon the decision in L.G. Balakrishnan & Ors. vs. CWT (1988) 69 CTR (Mad) 110 : (1988) 173 ITR 266 (Mad) : TC 63R.443. That decision is no longer good law. The question is now governed by the decision of this Court in Bharat Hari Singhania vs. CWT (1994) 118 CTR (SC) 125 : (1994) 207 ITR 1 (SC) : TC 63R.362. The civil appeals are, therefore, allowed and the question is answered in favour of the Revenue. No order as to costs.

[Citation : 248 ITR 575]