TMI Blog1986 (11) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome) on behalf of the State and not on its own account ? (2) Whether the income in regard to which the assessment is sought to be made under the Income-tax Act, against the Corporation, is in truth and reality the income of the State of U.P. and is, therefore, exempt from income-tax under article 289(1) of the Constitution ? " For the assessment year 1978-79, the assessee-Corporation submitted return declaring a loss of Rs. 7,57,800 and that its income is exempt under section 10(20) of the Income-tax Act. The assessee's plea regarding exemption was not accepted by the Inspecting Assistant Commissioner of Incometax (Assessment), Lucknow. As against this order, an appeal was filed which was partly accepted but the plea of exemption un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 10(20). He did not examine other grounds taken in the appeal. The Forest Corporation had filed an application under sub-section (1) of section 256 for the year 1976-77. The application was rejected by the Tribunal on the finding that no question of law arose out of the order of the Tribunal which was to be referred to the High Court. The application in respect of the assessment year 1977-78 was also rejected. While rejecting, the Tribunal remarked : " Following the aforesaid earlier order of the Tribunal dated February 22, 1984, we refuse to refer the question suggested by the parties in the aforesaid reference application on the ground that nothing had been brought before us to take a contrary decision ........" As against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court should engage itself in deciding a futile controversy-a controversy which does not call for decision which will have no bearing on its result. The controversy about the applicability of article 289(1) of the Constitution is merely academic in the facts of the present case. It has been held in Madanlal Dharnidharka v. CIT [1948] 16 ITR 227 (Bom) and CIT v. M. P. Sugar Mills (P) Ltd. [1975] 101 ITR 655 (All), that unnecessary or irrelevant questions should not be answered. It was noted in the previous order of the High Court rejecting the application under section 256(2) that since the Revenue had not filed any application against the judgment of the Income-tax Appellate Tribunal holding the assessee to be entitled to exemption unde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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