High Court clarifies tax questions, rules in favor of assessee, refrains from deciding constitutionality.

The High Court addressed two questions raised by the Revenue. The first question was left unanswered, while the second question was decided in favor of the assessee based on a previous case. The Tribunal's reliance on the earlier decision was deemed justified as there was no contrary ruling from any other High Court. The Court refrained from ruling on the constitutionality of section 140A(3) and stated it was not within its jurisdiction to decide on such matters in a reference case. No costs were awarded in this judgment.

---

---

Issues involved:
1. Whether section 140A(3) of the Income-tax Act, 1961, is confiscatory and violative of article 19(1)(f) of the Constitution of India as held by the Madras High Court in the case of A. M. Sali Maricar v. ITO [1973] 90 ITR 116Rs.
2. Whether the Tribunal was justified in relying upon the decision of the Madras High Court in A. M. Sali Maricar v. ITO [1973] 90 ITR 116Rs.

Summary:
The High Court addressed two questions raised by the Revenue. The first question was not answered, while the second question was answered in favor of the assessee based on the court's judgment in a previous case. The Tribunal was deemed justified in following the Madras High Court's decision in A. M. Sali Maricar's case as there was no contrary decision from any other High Court at that time. The Tribunal did not rule on the validity of section 140A(3) in the current judgment, and the High Court stated it was not within its jurisdiction to decide on the constitutional validity of a provision in a reference case.

No costs were awarded in this judgment.

---