Surtax deduction not allowable in computing total income; Calcutta High Court followed its earlier precedent and upheld rejection of the claim.

Surtax payable under the Companies (Profits) Surtax Act, 1964 was not an admissible deduction in computing total income under the Income-tax Act, 1961. The Calcutta High Court treated the issue as governed by its earlier decision on the same point and followed that precedent. On that basis, it held that the Tribunal had correctly rejected the assessee's claim for deduction and answered the referred question in favour of the Revenue.

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Issues: Whether surtax payable under the Companies (Profits) Surtax Act, 1964, was deductible in computing the assessee's total income under the Income-tax Act, 1961.

Analysis: The question was treated as covered by an earlier decision of the same Court holding that surtax liability was not an admissible deduction in computing taxable income. Following that precedent, the Court answered the referred question in the affirmative in the sense that the Tribunal had correctly rejected the assessee's claim.

Conclusion: The claim for deduction of surtax payable was rejected and the question was answered in favour of the Revenue.

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