Adarsh Kumar Goel, J.@mdashFollowing questions of law have been referred for opinion of this Court u/s 256 of the Income Tax Act, 1961 (for short, "the Act"), by the Income Tax Appellate Tribunal, Chandigarh arising out of its order dated 25.3.1998 in I.T.A. No. 960/Chandi/94 in respect of the assessment year 1993-94:
(i) Whether in the facts and circumstances of the case, the authorities had erred in law while not allowing rebate u/s 88 of the IT Act in-respect of deposits in PPF while interpreting words of Section 88(2) of the IT Act, 1961 "out of his income chargeable to tax" stating the said deposit has to be linked and identified with his income of the previous year alone and the rebate could not be allowed if the deposit is made from other monies available with the assessee in his account by receipt of borrowing etc. even if the assessee had sufficient income chargeable to tax sufficient to meet the deposit.
(ii) Whether in the facts and circumstances of the case, the authorities erred in law in interpreting the CBDT circular No. 3P dated 11.10.1965 clarifying the expression "out of his income chargeable to tax" by ignoring the material portion of explanation stating that it does not imply that assessee is required to link or identify the deposit/payments specifically with the funds representing his income chargeable to tax and relying only on a part there of that the benefit cannot be availed of in cases where it is clear that payments cannot be attributed directly or indirectly to the assessee�s income chargeable to tax.
(iii) Whether in the facts and circumstances of the case, the authorities had misdirected themselves in ignoring the material fact that the assessee had income of Rs. 76100/- chargeable to tax which was sufficient to meet the investment/deposit of Rs. 49000/- in PPF by disallowing the rebate because the deposit was made form his bank account in which he had received borrowed monies.
2. It appears that the matter is covered against the assessee by judgments of Kerala High Court in
