TMI Blog1991 (2) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... . The assessee is a company and the proceedings relate to its assessment for the years 1970-71 and 1971-72. By an order under section 256(1) of the Income-tax Act, 1961, the Tribunal has referred to this court the following three questions of law: "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the cost of technical know-how which wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e industrial undertaking for the assessment year 1971-72 ?" Briefly stated, the facts relevant for question No. 1 are that the assessee purchased technical know-how from its foreign collaborators for sum of Rs. 14,34,000. An asset was created in the balance-sheet representing the said amount in the name of technical know-how. However, when the question came up before the Income-tax Officer as re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Income-tax Appellate Tribunal held that the amount was includible in the capital computation. Reference in this regard was made to rule 19A(2)(ii) of the Income-tax Rules. After hearing Dr. Balasubramanian for the Revenue and Shri Dalvi for the assessee, we find that there is no dispute between the parties that the entire sum of Rs, 14,34,000 appeared as an asset in the books of the com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7,07,390 represented the assessee's money required for its business. Since, however, the monies were not required immediately, the assessee made short-term deposits of these monies and earned interest thereon. The question that arose for the purpose of granting relief under section 80-I was whether such an income was a business income so as to earn benefit under that section. The assessee's case w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustrial undertaking. It is not something which has nothing to do with the industrial undertaking. This is the money collected for the purpose of the industrial undertaking, and, therefore, following our court's decision in the case of CIT v. Hindustan Antibiotics Ltd. [1982] 137 ITR 42, we answer the third question also in the affirmative and in favour of the assessee. No order as to costs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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