2001 (7) TMI 37 - HC - Income Tax

Summary

The High Court of Delhi ruled on questions referred by the Income-tax Appellate Tribunal regarding the computation of capital employed for section 80J of the Income-tax Act, 1961. The first question was answered in favor of the Revenue based on the decision in Lohia Machines Ltd. v. Union of India [1985] 152 ITR 308 (SC). The second question clarified that capital should be taken as on the first day of the accounting period, not the average. The Tribunal will compute the correct figure under section 260 of the Act.