1987 (2) TMI 47

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..... questions called for our opinion are as follows: "(1) Whether, on the facts and in the circumstances of the case, the learned Commissioner of Income-tax, Bihar No. II, Ranchi, had jurisdiction to revise the order of the Income-tax Officer, Ward C, Jamshedpur, under section 263 of the Income-tax Act on May 20, 1980, and to give a direction to the Income-tax Officer to compute the relief under sec .....

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..... to it. After hearing the assessee, the Commissioner, by order dated May 20, 1980, rejected the stand of the assessee and held that the relief granted to the assessee in terms of section 80J of the Act was erroneous. The assessee, being aggrieved by the order of the Commissioner, filed an appeal before the Tribunal. The Tribunal endorsed the view of the Commissioner holding that the assessee was .....

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..... 9A of the Rules. The Supreme Court by majority of 4:1 held in paragraph 28 in the case of Lohia Machines Ltd. v. Union of India [1985] 152 ITR 308, that rule 19A of the Rules in so far as it excluded borrowed monies and debts in the computation of the employed and provided for computation of the 'capital employed' as on the first day of the computation period was not ultra vires, section 80J of th .....

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..... had no jurisdiction grant relief under section 80J of the Act on borrowed capital which could not be excluded from the expression 'capital employed'. Both the questions are, therefore, answered in favour of the Revenue and against the assessee. The reference is answered accordingly. The reference is thus disposed of with costs. Hearing fee Rs. 250 payable by the assessee. This reference had b .....

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..... ave acted in terms of rule 19A of the Rules. This submission is entirely fallacious and is bound to be rejected. The result of the Supreme Court decision is that rule 19A of the Rules was a valid piece of legislation at all times. The Commissioner and the Tribunal, therefore, were right in holding that the relief claimed by the assessee could not have been granted. In that view of the matter, ther .....

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