Cit vs Jain Tube Co. Ltd.
2003 Latest Caselaw 318 Del

JUDGMENT

D.K. Jain, J.

The matter has been placed before us for appropriate orders as the revenue, at whose instance the reference has been made, has failed to file the paper books despite various opportunities. Since answer to the question referred stands concluded by the decision of this court, we dispense with the filing of the paper books and proceed to dispose of the reference at this stage itself.

2. The Income Tax Appellate Tribunal, Delhi Bench-B, New Delhi (hereinafter referred to as the "Tribunal") has referred under section 256(1) of the Income Tax Act, 1961 the following question for our opinion :

2. The Income Tax Appellate Tribunal, Delhi Bench-B, New Delhi (hereinafter referred to as the "Tribunal") has referred under section 256(1) of the Income Tax Act, 1961 the following question for our opinion :

"Whether on the facts and in the circumstances of the case, the Tribunal was right in deleting the addition of Rs. 40,000 by holding that allowable limit under section 40A(5)(a) in case of employee directors was of Rs. 72,000 and head-wise limits in section 40A(5)(c) did not apply ?"

3. There is no appearance on behalf of the assessed. Accordingly we have heard Mr. R.D. Jolly, learned senior standing counsel for the revenue.

3. There is no appearance on behalf of the assessed. Accordingly we have heard Mr. R.D. Jolly, learned senior standing counsel for the revenue.

4. A similar question came up for consideration of this court in CIT v. Siya Ram Kumar Engg. Works (P) Ltd.(2002) 254 ITR 358 (Del) and it was held that section 40A(5)(c) applies to persons other than directors whereas section 40A(5)(a) relates to the directors.

4. A similar question came up for consideration of this court in CIT v. Siya Ram Kumar Engg. Works (P) Ltd.(2002) 254 ITR 358 (Del) and it was held that section 40A(5)(c) applies to persons other than directors whereas section 40A(5)(a) relates to the directors.

5. In view of the said decision, no fault can be found with the view taken by the Tribunal. The question referred is accordingly answered in the affirmative, i.e., in favor of the assessed and against the revenue.

5. In view of the said decision, no fault can be found with the view taken by the Tribunal. The question referred is accordingly answered in the affirmative, i.e., in favor of the assessed and against the revenue.

6. The reference stands disposed of with no order as to costs.

6. The reference stands disposed of with no order as to costs.