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The Commissioner Of Income Tax v. Electra India Ltd - INCOME TAX REFERENCE No. 50 of 1989  RD-AH 137 (10 January 2005)
Income Tax Reference No.50 of 1989
Commissioner of Income Tax Vs. M/s. Electra India Limited Meerut.
Hon'ble R.K. Agrawal, J
Hon'ble P.Krishna, J
The Income Tax Appellate Tribunal, Delhi has referred the following question of law under section 256 (1) of the Income Tax Act 1961 (hereinafter referred to as the Act) for opinion to this Court:-
"Whether the Tribunal was legally correct in deleting the addition of Rs.12,072/- made by the Inspecting Asstt. Commissioner (Asstt.) in view of the provisions of Section 40A (5)( c ) of the I.T. Act,1961."
Briefly stated the facts giving rise to the present reference are as follows:-
The reference relates to the assessment year 1982-83. The respondent- assessee is a private limited company. An addition of Rs. 12,072/- was made by the learned assessing officer which represented the value of perquisites provided to the three directors. The assessing Officer was of the opinion that perquisites exceeded 1/5th of the salary paid to each one of them and therefore the excess was disallowed applying the provisions of Sec.40A (5) ( c ) of the Act. The addition was deleted by the Commissioner of Income Tax (Appeals) which order has been upheld by the Tribunal.
We have heard Shri Sambhu Chopra, the learned standing counsel for the Revenue and Shri Amitabh Agrawal, holding brief of Shri P.K. Jain, Advocate. It is agreed between the parties that the present reference is squarely covered by the decision of this Court in the case of M/s. Abbas Wazir (Pvt.) Ltd. Vs. Commissioner of Income Tax, Allahabad (2004) U.P. Tax Cases 275 which has been followed by this Court in the I.T.R. No.298 of 1983 The Commissioner of Income Tax Meerut Vs. M/s. Saru Smelting (P) Ltd., Meerut decided on 2nd September,2003 wherein this Court has answered the question in favour of assessee and against the Revenue.
Respectfully following the aforesaid decision of this Court we also answer the question referred to us in favour of the assessee and against the Department. However, there shall be no order as to costs.
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