Secured loans count toward capital employed for section 80J deduction when binding High Court precedent applies.

Secured loans were includible in the capital employed for computing deduction under section 80J where a binding High Court decision governed the issue. The appellate authority therefore directed recomputation of the relief on that basis, and the Tribunal found no error because the Calcutta High Court ruling in Century Enka Ltd. held the field. The Revenue's challenge to exclusion of secured loans failed, and the order for recomputation of the deduction was affirmed.

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Issues: Whether, for computing deduction under section 80J, secured loans were to be included in the capital employed.

Analysis: The assessee's claim for inclusion of secured loans in the capital base was accepted in accordance with the prevailing decision of the Calcutta High Court in Century Enka Ltd. The appellate authority directed computation of the relief under section 80J on that basis, and the Tribunal found no error in that approach as the High Court ruling held the field.

Conclusion: The secured loans were to be included in the capital employed for the purpose of deduction under section 80J, and the Revenue's challenge failed.

Final Conclusion: The order directing recomputation of the deduction under section 80J on inclusion of secured loans stood affirmed, and the Revenue's appeal was dismissed.

Ratio Decidendi: Where a binding High Court decision governs the computation of capital employed under section 80J, the authorities must apply that decision and recompute the deduction accordingly.

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