Jallo Subsidiary Industries Co. ... vs Commissioner Of Income Tax
2001 Latest Caselaw 958 Del

JUDGMENT

Arijit Pasayat, C.J.

1. Heard.

2. At the instance of the assessed, the following question has been referred for the opinion of this court by the Income-tax Appellate Tribunal, Delhi Bench "D" (in short "the Tribunal"), under Section 256(1) of the Income-tax Act, 1961 (in short "the Act") :

"Whether, on the facts and in the circumstances of the case, the liability of excise duty at Rs. 93,879 arising out of the order of the Collector, Central Excise, made during the accounting period relevant to the assessment year under appeal arises and is allowable under Section 28/37 of the Income-tax Act, 1961 ?"

3. As the question itself indicates, the main issue related to accrual of liability and the fact that the Tribunal found that the accrual of liability was when the goods were removed from the factory, and not during the assessment year involved, i.e., 1973-74. The issue is no longer res integra in view of the decision of the apex court in Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363. That being the position, the inevitable answer to the question is that the Tribunal's view was correct and the liability did not arise out of the order of the Collector but on the date of removal of the goods from the factory. The question is answered in favor of the Revenue and against the assesses.

4. The reference stands disposed of.