Commissioner of Income-tax, Tamil Nadu v. M/s. Balaji Enterprises (SC) BS117504

Commissioner of Income-tax, Tamil Nadu v. M/s. Balaji Enterprises (SC) BS117504 SUPREME COURT OF INDIA

Before:- B.N. Kirpal and N. Santosh Hegde, JJ.

Civil Appeal No. 4413 of 2001 (arising out of S.L.P. (C) No. 4664 of 2001). D/d. 20.7.2001.

Commissioner of Income-tax, Tamil Nadu-V - Appellant

Versus

M/s. Balaji Enterprises - Respondent

Income-tax Act, 1961, Section 256 - Question of law - Reference to High Court - Deduction of service charges - Question arose as to whether Tribunal was correct in directing Assessing Officer to allow this deduction to assessee - Held, question of law does arise - Tribunal directed to refer this question to High Court.

[Para 3]

JUDGMENT

1. Special leave granted.

2. After hearing the counsel for the parties, in our opinion, question of law does arise, especially in view of the fact that the Madras High Court in 236 ITR 589 in a case of the respondent relating to a similar claim for deduction had allowed the application under Section 256(2) of the Income-tax Act.

3. 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 Assessing Officer to allow deduction of service charges amounting to Rs. 1,82,03,470/- or any part thereof?"

Appeal allowed.