1993 (1) TMI 9

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..... have been referred to this court by the Income-tax Appellate Tribunal, under section 256(1) of the Income-tax Act, 1961 : " 1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in setting aside the order of the Income-tax Officer withdrawing the development rebate of Rs. 6,67,351 ? 2. Whether, on the facts and in the circumstances of .....

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..... reserve for the said purpose ?" During the course of assessment proceedings for the assessment year 1971-72, the Income-tax Officer noticed that the statutory development rebate reserve of Rs. 5,33,690 created in the assessment year 1969-70 was transferred to the general reserve immediately in the next accounting year 1969-70. The Income-tax Officer, therefore, exercising the power under section .....

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..... a reference made to this court, it was held that once the balance in the development rebate reserve gets exhausted on acquisition of new capital assets of higher value, its subsequent transfer to the general reserve does not infringe the conditions laid down in section 34(3) so as to justify withdrawal of the development rebate. Once it is established that the development rebate reserve was utilis .....

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