1986 (6) TMI 6

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..... ied in holding that capital work-in-progress in the industrial undertaking Electrolytic Manganese Company, should be included in the computation of 'capital employed' for the purpose of the relief under section 80J of the Income-tax Act, 1961 ? " On an application of the assessee under section 256(1), the following questions have been referred as questions of law arising out of the orders of the Tribunal for the opinion of this court: For the assessment year 1974-75 : " 2. Whether, on the facts and in the circumstances of the case, the Tribunal erred in holding that while computing the capital for the purpose of relief under section 80J, the accrued proportionate interest on borrowed capital has to be excluded in view of the fact that .....

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..... f capital employed in several industrial undertakings taken before the Tribunal in cross-objections as an aspect of the computation of capital employed in the matter of allowing relief under section 80J already considered by the Commissioner of Income-tax (Appeals) in his order dated October 28, 1978, and the plea raised in this behalf was purely one of law involving no further investigation ? " On the question referred at the instance of the Revenue for the assessment year 1975-76, it has been found that the assessee set up a new industrial undertaking called " Electrolytic Manganese Company " in the relevant assessment year. The Income-tax Officer excluded the value of the capital work-in-progress in respect of the said undertaking in t .....

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..... the first day of the accounting period was a question of fact and the same has not been disputed or agitated by the Revenue up till now. It was submitted that this court sitting in its advisory jurisdiction should not enquire into facts not on record. It was submitted that this factual aspect of the question was never raised or agitated in any of the earlier proceedings. The controversy which was raised before the Tribunal undoubtedly is covered by the said decision of this court in Indian Oxygen Ltd.'s case [1978] 113 ITR 109 and, therefore, it could not be said that the Tribunal was not justified in holding that the capital work-in-progress had to be taken into account in computing the capital for the purpose of section 80J of the Act. .....

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