1995 (11) TMI 13 - HC - Income Tax

Summary

Issues involved:
The judgment involves three main issues:
1. Jurisdiction of the Tribunal to ascertain the method of accounting for pension liability.
2. Allowability of surtax liability as a deduction in computing total income for income-tax purposes.
3. Classification of loss from foreign remittances and revaluation of foreign liabilities as capital expenditure.

Jurisdiction to ascertain accounting method for pension liability:
The Tribunal remanded the matter to the Appellate Assistant Commissioner for fresh consideration. The assessee requested the matter to be heard by the Tribunal instead, citing previous favorable decisions. Both parties agreed for the Tribunal to reconsider the issue based on past orders and court decisions. The High Court directed the Tribunal to examine the matter itself, considering the previous orders and observations.

Surtax liability deduction:
The High Court referred to a previous decision in Lubrizol India Ltd. v. CIT [1991] 187 ITR 25, stating that the issue was covered by that ruling. Following the precedent, the Court answered in the affirmative and in favor of the Revenue.

Classification of loss from foreign remittances:
Referring to the decision in Padamjee Pulp and Paper Mills Ltd. v. CIT [1994] 210 ITR 97, the Court found that the issue was also covered in favor of the Revenue. The Court answered question No. 3 in the affirmative and in favor of the Revenue. The Tribunal was directed to consider the issue of depreciation, if raised by the assessee, in accordance with the law.

Conclusion:
The Court disposed of the reference accordingly, without answering question No. 1 directly. The Tribunal was instructed to examine the controversy itself based on previous orders and observations. No costs were awarded in the matter.