TMI Blog1981 (3) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal, giving rise to the suggested question of law, is unimpeachable on merits and is wholeheartedly endorsed by the High Court. (3) We can agree with the opinion formed by the Tribunal after and only after we require the Tribunal to state the, case and again rehear the parties (we have already heard them at this stage of issuing the if rule , but that is not enough. In other words, we must rehear them once again after the case is formally stated and we formally rehear them, and at this stage the rule must be made absolute as a matter of course. These three propositions, we must assent to, if we are to accede to the request for requiring the Tribunal to state a case and refer the suggested question of law to this court. We feel no hesitation, or entertain no misgiving on the score, and negative all the three propositions. We propose to give our reasons for doing so, as also for concluding that the opinion formed by the Tribunal, in regard to the question of law suggested by the applicant, is unexceptionable. We propose to settle this seminal question at the threshold at this juncture before we enter upon a discussion on the question of law which the applicant persuaded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stares one in the eye is the user of the expression if it is not satisfied with the correctness of the decision of the Appellate Tribunal . The High Court has, therefore, to apply its mind to both these aspects unless it is expected to mechanically grant an application invoking the powers of the High Court under sub-s.(2) of s. 256 of the Act. Whether or not the High Court should exercise the power liberally, almost for, the asking of it, without attaching too much importance to the dimension as regards the discretion invested in the High Court (the expression used being may and not shall unlike sub-s. (1) of s. 256) and without regard to the consideration as regards the correctness or otherwise of the decision to the Appellate Tribunal, is not a question which can be resolved in an unrealistic manner unmindful of the existing burden of arrears of cases of various categories in the High Court, which has almost brought citizens who are victims of serious injustice have to wait for a number of years (if they do not depart from the world meanwhile) before their causes come up for hearing. Then there are appeals and further appeals (which cannot be avoided) during the penden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by him that, .(1) if the court finds that the question of law answers itself, or (2) that it is patently unarguable, there is no reason why the time of the Commissioner or of the court should be wasted in asking the Commissioner to refer to the High Court questions of law. Ingenuity of lawyers , says Chagla C.J. (p. 191) will always suggest questions of law arising out of the findings of the Commissioner. It is only when the court is satisfied that a question of law arises and that it requires consideration by the court that the court would direct the Commissioner to raise a question of law. Needless to say that the aforesaid statement of law is made in the context of the duty cast on the Commissioner to make a reference to the High Court upon being required to do so (which corresponds to sub-s. (1) of s. 256 of the Act), whereas we are concerned with the power of the High Court to require the Tribunal to refer a question to it under sub-s. (2) of s. 256 of the Act, which itself confers powers upon the High Court with a rider to use its discretion in a judicial manner (the expression used is may ) and upon the High Court not being satisfied with the correctness of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs awaiting decision is to deny justice to those who are suffering injustice for a time interval of unpredictable duration. We, therefore, unhesitatingly hold that we are not bound to require the Tribunal to refer the question to us for our opinion merely because a question of law arises, if we are otherwise satisfied that the point has been rightly decided and can be supported by reasonable and valid arguments. Nay, we would go to the length of saying that we would be abdicating our duty and betraying the trust reposed in us by Parliament, if we were to accede to the request unmindful of the aforesaid two considerations enjoined by the Legislature. The present is a case where, we are constrained to say, the aforesaid principle is attracted and attracted squarely so that we feel justified in rejecting the application made by the Commissioner for requiring the Tribunal to state the case to us in exercise of the powers under sub-s. (2) of s 256 of the Act. The reasons which impel us to reach this conclusion we shall presently state after setting out the question of law which the Commissioner requested the Tribunal to refer to us, namely: Whether, on the facts and in the circu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of capital expenditure. 2. It must be laid out or expended wholly and exclusively for the purpose of the business or profession. 3. It must not be of the nature described in ss. 30 to 36 and s. 80VV (which is enforced with effect from April 1, 1976). Subject to these three basic conditions being satisfied some tests can be evolved on first principles. The tests can be divided into two categories, namely, (1) positive tests, (2) negative tests. One (at least one) of the positive tests must nod its head and none (not even one) must do so in order to affirmatively hold that the expenditure is a business expenditure inter alia, incurred on account of commercial expediency. Positive tests Negative tests If the expenditure is incurred : - If it is incurred :- 1. with a view to bring profits or monetary advantage either today or tomorrow. 1. for a mere altruistic consideration. 2. to render the assessee immune from impending or reasonably apprehended litigation. 2. mainly in order to satisfy his philanthropic urges, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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