B.P. Jeevan Reddy, C.J.@mdashTwo questions are referred u/s 256(2) of the Income Tax Act, 1961, namely :
(1) Whether, on the facts and in the circumstances of the case, the assessee-company was entitled to the allowance of Rs. 1,59,501 by way of
interest in the assessment year 1966-67 ?
(2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in allowing the loss of Rs. 5,985 to the assessee on the
sale of U. P. State Development Loan ?
2. So far as question No. 1 is concerned, it is brought to our notice that a Bench of this court has answered an identical question in the case of this
very assessee in favour of the Department and against the assessee in Commissioner of Income Tax Vs. H.R. Sugar Factory, . Following the said
decision, question No. 1 is answered in the negative, i.e., in favour of the Revenue and against the assessee.
3. So far as question No. 2 is concerned, it is also concluded by a decision of this court in a similar matter, viz., Income Tax Reference No. 862 of
1978, disposed of on August 20, 1990, Commissioner of Income Tax Vs. S.B. Sugar Mills, , following the decision of the Supreme Court in
Patnaik and Co. Ltd. Vs. Commissioner of Income Tax, Orissa, . Accordingly, question No. 2 is answered in the affirmative, i.e., in favour of the
assessee and against the Department. No costs.
