1999 (7) TMI 65

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.... 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the fixed deposit of Rs. 5,13,36,000 should be included in the capital employed for the purpose of section 80J of the Income-tax Act, 1961 ?" In the first original assessment, the assessee claimed a sum of Rs. 1,45,206 representing expenditure on incomplete capital jobs, should be taken into account in the capital employed for the purpose of section 80J of the Income-tax Act, 1961. Similarly, the assessee claimed a sum of Rs. 5,13,36,000, which was in the bank as fixed deposit should also be treated as capital employed for the purpose of section 80J of the Act. The Income-tax Officer did not allow the claim of the assessee....

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.... appeal before the Tribunal, the Tribunal has confirmed the order of the Commissioner of Income-tax (Appeals) on both the issues. After hearing learned counsel for the parties, we are surprised that the Income-tax Officer has ignored the direction of the appellate authority. Such type of attitude of the Income-tax Officer shows that either he is dishonest or ignorant of the basic terms of judicial propriety. On the merits, various High Courts have decided the issues in favour of the assessee, including this High Court. Question No. 1 relates to the issue whether expenditure on incomplete plant and machinery can be allowed for computing the capital employed for the purpose of section 80J of the Act. In the case of CIT v. Union Carbi....