Commissioner of Income Tax vs Kabir Dass Investment Ltd.

B.N. Kirpal, J.—This petition u/s 256(2) of the Income Tax Act, 1961, pertains to the assessment year 1981-82 and the Commissioner seeks reference of two questions of law to this court.

Learned counsel for the petitioner has brought to our notice the order of the Tribunal u/s 256(1) in respect of the assessment year 1980-81, where the Tribunal itself has referred two identical questions of law to this court for its decision. In view thereof, we direct the Tribunal to state the case and refer the following two questions of law to this court :

"1. Whether the Income Tax Appellate Tribunal was correction law in holding that interest paid on loans borrowed by the assessed is not to be apportioned between income from business and income from dividends and that thus is fully adjustable against business income only ?

Whether the Income Tax Appellate Tribunal was correct in law in holding that, for the purpose of deduction u/s 80M, it was the gross dividend income that should be considered, especially in view of the decision of the Supreme Court in the case of Distributors (Baroda) Pvt. Ltd. Vs. Union of India (UOI) and Others, ?"