Precedent on identical facts controlled both income-tax issues, securing section 80J relief and higher depreciation for the assessee.

A referred tax question covered by an earlier binding decision on identical facts was answered consistently with that precedent, so relief under section 80J was allowed to the assessee. On the depreciation issue, the court again followed the prior ruling between the same parties and accepted the higher 15% rate for manufacturing artificial silk. Both questions were thus decided in favour of the assessee and against the Department, with the reference concluded by applying the existing authoritative decision on the same controversy.

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Issues: (i) Whether the assessee-company was entitled to relief under section 80J of the Income-tax Act, 1961. (ii) Whether the assessee-company, being engaged in manufacturing artificial silk, was entitled to depreciation at 15% instead of 10%.

Issue (i): Whether the assessee-company was entitled to relief under section 80J of the Income-tax Act, 1961.

Analysis: The reference was answered by following the earlier decision between the same parties on an identical controversy. The question was treated as covered by the prior ruling, which had decided the issue in favour of the assessee.

Conclusion: The issue was answered in favour of the assessee and against the Department.

Issue (ii): Whether the assessee-company, being engaged in manufacturing artificial silk, was entitled to depreciation at 15% instead of 10%.

Analysis: The question was also covered by the earlier decision between the same parties on the same controversy. On that basis, the claimed higher depreciation rate was accepted.

Conclusion: The issue was answered in favour of the assessee and against the Department.

Final Conclusion: Both referred questions were answered in favour of the assessee, leaving the Department unsuccessful on the reference.

Ratio Decidendi: Where a referred question is covered by an earlier binding decision on identical facts and controversy, the court may answer it consistently with that precedent in favour of the assessee.

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