Reversed precedent cannot sustain a High Court order on section 80HHC; the matter must be reconsidered on merits.

Where a High Court order dismissing an income-tax appeal rested on a precedent later reversed by the Supreme Court, the foundation of that decision no longer survived. The discussion notes that the earlier precedent had been applied to the deduction issue under section 80HHC of the Income-tax Act, 1961, so the impugned order could not stand on that basis. The matter therefore required fresh consideration by the High Court in accordance with law, and the order was set aside with remand for decision on merits.

---

---

Issues: Whether the High Court's order dismissing the appeal could be sustained after the precedent it followed had been reversed, and whether the matter required remand for reconsideration on merits.

Analysis: The order under challenge rested on an earlier High Court decision that had already been reversed by the Supreme Court. Since the reversed precedent had been applied to decide the issue concerning deduction under section 80HHC of the Income-tax Act, 1961, the foundation of the impugned order no longer survived. The matter therefore required fresh examination by the High Court in accordance with law.

Conclusion: The impugned order was set aside and the matter was remanded to the High Court for decision on merits.

---