TMI Blog1987 (8) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal on account of reinvestment of the same amount realised on maturity of the said certificates ?" 3. on this issue, we have heard the parties and carefully considered their rival submissions. The facts relevant for determination of the issue are as under. 4. The assessee, Shri Inder Madhok, had purchased, in some year prior to the assessment year under appeal, six-year National Savings Certificates. It is common ground that in the year when these certificates were purchased, the assessee got necessary deduction in respect of the amount invested there in accordance with law laid down u/s 80C of the I. T. Act, 1961. The issue now is whether the assessee, who had reinvested the said amount on maturity of the National Savings Certifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the view propounded by the learned counsel for the assessee is not at all a reasonable view because the very purpose of this provision was encouragement of savings by the taxpayers, and, therefore, there cannot be any argument, that the deduction has to be allowed irrespective of the fact whether the payment or investment is made out of the income of the previous year relevant to the assessment year or not. 7. The ld. D. R. invited our attention to the charging provisions contained in sections 4 and 5 of the Act and submitted that if the definition of total income incorporated u/s 2(45) of the Act is considered, it becomes clear that the case of the assessee is not tenable at all. He also relied upon the Bombay High Court jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income in a particular year. We are of he opinion that whenever there is a reference in the act to "income chargeable" to tax or not chargeable to tax, this is in the context of a particular assessment year as each year is an independent assessment year. 9. We also find that the deduction provided u/s 80C is of the type that reduces the incidence of tax but encourages savings of the individual or any other person, as the case may be. Therefore, the objective with which this legislation was introduced cannot be lost sight of. If we accept the interpretation, which is required to be placed on these provisions by the learned counsel for the assessee, it will run counter to the objective and this interpretation will not be in furtherance of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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