TMI Blog1975 (5) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... awing the same ? " The facts of the case, as, appear from the statement of the case, are as follows : The assessee is a private limited company. In the accounting year that is, the financial year 1965-66, the assessee had installed machineries, the cost of which came to Rs. 1,32,010. A development rebate amounting to 20% of the same, that is, Rs. 26,402, was allowed by the Income-tax Officer in the assessment. The reserve created by the assessee was also to the extent of Rs. 26,402. It was created by debiting the profit and loss account. The Income-tax Officer subsequently noticed that the assessee is entitled to a development rebate at the rate of 35% and not 20%. The development rebate at the enhanced percentage would be Rs. 46,203. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tention of the company that section 154 was not applicable. On further appeal before the Income-tax Appellate Tribunal the assessee contended that sufficient reserve was created for the assessment year 1968-69, which would more than compensate the deficiency of the assessment year 1966-67 and, therefore, the order withdrawing the development rebate was not tenable in law. The Tribunal, however, did not accept the said contention holding that as far as the assessment year was concerned adequate reserve was not created and since the required reserve was not created during the accounting year the claim of the assessee could not be upheld. Thus, the Tribunal dismissed the appeal. On the above facts the above question of law has been referred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed is debited to the profit and loss account of the relevant previous year and credited to a reserve account to be utilized by the assessee during a period of eight years next following for the purposes of the business of the undertaking ........" Admittedly, in the instant case seventy-five per cent. of the development rebate to be actually allowed was not debited to the profit and loss account and the reserve fund was not created in the assessment year 1966-67. That being so reading the provisions of section 33 and section 34 of the Act it is quite clear that the assessee in the instant case is not entitled to the rebate as claimed for the assessment year 1966-67. The learned counsel for the petitioner has referred to certain dec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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