COMMISSIONER OF INCOME TAX, MADRASversusM/S. LUCAS T.V.S. LTD. PADI CHENNAI

A           COMMISSIONER OF INCOME TAX, MADRAS
                                     v.
               MIS. LUCAS T.V.S. LTD. PADI CHENNAI

                          DECEMBER 14, 2007
B        [DR. ARIJIT P ASAY AT AND P. SATHASIVAM, JJ.]


        Income Tax Act, 1961; Ss. 32A and 43A(l):
         Investment allowance-Allowing of in one or more than one
C financial years-Held: S.43A(J) relates to fluctuation offoreign
   exchange and has nothing to do with allowability of investment in
   terms of s. 32(A) of the Act in one or more assessment years-High
   Court did not take into consideration the related provisions of law in
   its proper perspective while dismissing the appeal of the Revenue-
D Hence, matter remitted to High Court for adjudication afresh after
  formulating the question of law involved.
        The main issue arose for consideration in these appeals was
  as to whether investment allowance under Section 32A of the Income
E Tax Act, 1961 could be allowed in one financial/assessment year only
  or in more than one financial years. The assessing officer was of the
  view that it is only to be allowed in one assessment year and not
  several assessment years. The Tribunal has proceeded on the basis
  that in view of Section 43A(l) of the Act the allowance could be
F granted in different assessment years. The order of the Tribunal was
  affirmed by the High Court relying on the decision of the High Court
  in the case of Southern Asbestos Cement Ltd. v. Commissioner of
  Income Tax (259 I.T.R.631). Hence the present appeals.
       Appellant contended that Section 43A(l) of the Income Tax Act
G relates to fluctuations of foreign exchange and its effect on the
  valuation of the assets. It has nothing to do with the question as to
  whether it is allowable in one year. Therefore, the decision relied
  upon by the High Court has no application.

                                    958
H
       COMMISSIONER OF INCOME TAX, MADRAS v. MIS.                      959
         LUCAS T.V.S.LTD. PADICHENNAI [PASAYAT,J.]
         Allowing the appeals, the Court                                     A
        HELD: Since contention of the appellant-Revenue that
    S.43A(l) of the Income Tax Act relates to fluctuation of foreign
    exchange and its effect on the valuation of the assets and it has
    nothing to do with the question as to whether it is allowable in one
    assessment year or more, accepted by respondent-assessee, the B
    matter is remitted to the High Court for fresh adjudication after
    formulating the question oflaw involved. [Para 5) [971-E-G]
        CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 5950-
    5952 of2007.                                                             c
        From the final Judgment and Order dated 15.3.2004 of the High
    Court of Judicature at Madras in ITA Nos. 109-111 of2004.
         P.P. Malhotra, ASG., Dr. R.G. Padia, Arijit Prasad, Shweta and B.V.
    Balaram for the Appellant.                                               D
         Radha Rangaswamy for the Respondent.
         The Judgment of the Court was delivered by
         DR. ARIJIT PASAYAT, J. l. Leave granted.
                                                                              E
          2. Challenge in these appeals is to the order passed by a Division
    Bench of the Madras High Court dismissing the Tax Case Appeals as
    according to the High Court the case at hand is covered against the

-   revenue in view of the order passed earlier by the High Court in Southern
    Asbestos Cement Ltd. v. Commissioner of Income Tax (259 l.T.R. F
    631).
         3. These appeals relate to assessment years 1989-90, 1991-92 and
    1992-93. The core issue is the allowability of investment allowance under
    Section 32A of the Income Tax Act, 1961 (in short the 'Act'). The
    assessing officer was of the view that it is only to be allowed in one G
    assessment year and not several assessment years. The Tribunal and the
    High Court appear to have proceeded on the basis that in view of Section
    43A(l) of the Act the allowance was to be granted in different assessment
    years.
                                                                             H
    960 SUPREME COURT REPORTS                    [2007] 13 (Addi.) S.C.R.

A      4. Sections 32A and 43A(l) of the Act read as under:
       Sectfon 32A- INVESTMENT ALLOWANCE.
                                                                                  ·-
        (1) In respect of a ship or an aircraft or machinery or plant
            specified in sub-section (2), which is owned by the assessee
B           and is wholly used for the purposes of the business carried
            on by him, there shall, in accordance with and subject to the
            provisions of this section, be allowed a deduction, in respect
            of the previous year in which the ship or aircraft was acquired
            or the machinery or plant was installed or, if the ship, aircraft,
c           machinery or plant is first put to use in the immediately
            succeeding previous year, then, in respect of that previous year,
            of a sum by way of investment allowance equal to twenty-five
            per cent. of the actual cost of the ship, aircraft, machinery or
            plant to the assessee:
D        Provided that in respect of a ship or an aircraft or machinery or
        plant specified in sub-section (8B), this sub-section shall have effect
        as if for the words "twenty-five per cent", the words "twenty per
        cent" had been substituted :

E          Provided further that no deduction shall be allowed under this
        section in respect of -
            (a) Any machinery or plant installed in any office premises or
            any residential accommodation, including any accommodation
            in the nature of a guest-house;
F
            (b) Any office appliances or road transport vehicles;
            (c) Any ship, machinery or plant in respect of which the
            deduction by way of development rebate is allowable under
            section 33; and
G           (d) Any machinery or plant, the whole of the actual cost of
            which is allowed as a deduction (whether by way of
            depreciation or otherwise) in computing the income chargeable
            under the head "Profits and gains of business or profession"
            of any one previous year.
H
      COMMISSIONER OF INCOME TAX, MADRAS v. MIS.                         961
        LUCAS T.V.S.LTD.PADI CHENNAI [PASAYAT,J.]
        Explanation: For the purposes of this sub-section, "actual cost" A
        means the actual cost of the ship, aircraft, machinery or plant to
        the assessee as reduced by that part of such cost which has been
        met out of the amount released to the assessee under sub-section
        (6) of section 32AB.
        (2) The ship or aircraft or machinery or plant referred to in sub- B
        section (1) shall be the following, namely :-
        (a) A new ship or new aircraft acquired after the 31st day of
        March, 1976, by an assessee engaged in the business of operation
        of ships or aircraft;
                                                                                c
        (b) Any new machinery or plant installed after the 31st day of
        March, 1976 -
...
            (i) For the purposes of business of generation or distribution
            of electricity or any other form of power; or
                                                                                D
            (ii) 454 in a small-scale industrial undertaking for the purposes
            of business of manufacture or production of any article or thing;
            or
            (iii) In any other industrial undertaking for the purposes of
            business of construction, manufacture or production of any E
            article or thing, not being an article or thing specified in the list
            in the Eleventh Schedule :
'•      Provided that nothing contained in clauses (a) and (b) shall apply
        in relation to, -                                                  F
             (i) A new ship or new aircraft acquired, or
           (ii) Any new machinery or plant installed, after the 31st day
           of March, 1987 but before the 1st day of April, 1988, unless
           such ship or aircraft is acquired or such machinery or plant is
                                                                              G
           installed in the circumstances specified in clause (a) of sub-
           section (8B) and the assessee furnishes evidence to the
           satisfaction of the Assessing Officer as specified in that clause;
        (c) Any new machinery or plant installed after the 31st day of
        March, 1983, but before the 1st day of April, 1987, for the H
    962 SUPREME COURT REPORTS                   [2007] 13 (Addi.) S.C.R.


A       purposes of business of repairs to ocean-going vessels or other
        powered craft if the business is carried on by an Indian company
        and the business so carried on is for the time being approved for
        the purposes of this clause by the Central Government.
        Explanation : For the purposes of this sub-section and sub-
B       sections (2B), (2C) and (4), - (1 )(a) "new ship" or "new aircraft"
        includes a ship or aircraft which before the date of acquisition by
        the assessee was used by any other person, if it was not at any
        time previous to the date of such acquisition owned by any person
        resident in India;
c
        (b) "New machinery or plant" includes machinery or plant which
        before its installation by the assessee was used outside India by
        any other person, if the following conditions are fulfilled, namely :-
                                                                                 -
D       (i) Such machinery or plant was not, at any time previous to the
        date of such installation by the assessee, used in India;
        (ii) Such machinery or plant is imported into India from any country
        outside India; and
E       (iii) No deduction on account of depreciation in respect of such
        machinery or plant has been allowed or is allowable under the
        provisions of the Indian Income-tax Act, 1922 (11 of 1922), or
        this Act in computing the total income of any person for any period
        prior to the date of the installation of the machinery or plant by
F       the assessee,
        (2) An industrial undertaking shall be deemed to be a small-scale
        industrial undertaking, if the aggregate value of the machinery and
        plant (other than tools, jigs, dies and moulds) installed, as on the
        last day of the previous year, for the purposes of the business of
G
        the undertaking does not exceed, -
        (i) In a case where the previous year ends before the 1st day of
        August, 1980, ten lak.h rupees;

        (ii) In a case where the previous year ends after the 31st day of
H
COMMISSIONER OF INCOME TAX, MADRAS v. M/S.                        963
  LUCAST.V.S.LTD.PADICHENNAl[PASAYAT,J.]
  July, 1980, but before the 18th day of March, 1985, twenty lakh A
  rupees; and
  (iii) In a case where the previous year ends after the 17th day of
  March, 1985, thirty-five lakh rupees, and for this purpose the
  value of any machinery or plant shall be, -
                                                                          B
  (a) In the case of any machinery or plant owned by the assessee,
  the actual cost thereof to the assessee; and
  (b) In the case of any machinery or plant hired by the assessee,
  the actual cost thereof as in the case of the owner of such machinery
  m~                                                                      C
  (2A) The deduction wider sub-section (1) shall not be denied in
  respect of any machinery or plant installed and used mainly for the
  purposes of business of construction, manufacture or production
  of any article or thing, not being an article or thing specified in the D
  list in the Eleventh Schedule, by reason only that such machinery
  or plant is also used for the purposes of business of construction,
  manufacture or production of any article or thing specified in the
  said list.
  (2B) Where any new machinery or plant is installed after the 30th E
  day of June, 1977 but before the 1st day of April, 1987, for the
  purposes of business of manufacture or production of any article
  or thing and such article or thing -
  (a) Is manufactured or produced by using any technology (including F
  any process) or other know-how developed in, or
  (b) Is an article or thing invented in, a laboratory owned or
  financed by the Government, or a laboratory owned by a public
  sector company or a University or by an institution recognised in
  this behalf by the prescribed authority 463 , the provisions of sub- G
  section (1) shall have effect in relation to such machinery or plant
  as if for the words "twenty-five per cent.", the words "thirty-five
  per cent" had been substituted, ifthe following conditions are fulfilled,
  namely:-
                                                                          H
    964 SUPREME COURT REPORTS                    [2007] 13 (Addi.) S.C.R.


A       (i) The right to use such technology (including any process) or other
        know-how or to manufacture or produce such article or thing has
        been acquired from the owner of such laboratory or any person
        deriving title from such owner;
        (ii) The assessee furnishes, along with the return of income for the
B       assessment year for which the deduction is claimed, a certificate
        from the prescribed authority to the effect that such article or thing
        is manufactured or produced by using such technology (including
        any process) or other know-how developed in such laboratory or
        is an artick or thing invented in such laboratory; and
c
        (iii) The machinery or plant is not used for the purpose of business
        of manufacture or production of any article or thing specified in
        the list in the Eleventh Schedule.
        Explanation: For the purposes of this sub-section, -
D
        (a) "Laboratory financed by the Government" means a laboratory
        owned by any body [including a society registered under the
        Societies Registration Act, 1860 (21 of 1860)] and financed
        wholly or mainly by the Government;
E             xx                        xx                        xx
       (c) "University" means a University established or incorporated by
       or under a Central, State or Provincial Act and includes an
       institution declared under section 3 of the University Grants
       Commission Act, 1956 (3 of 1956), to be a University for the
F
       purposes of that Act.
       (2C) Where any new machinery or plant, being machinery or plant
       which would assist in control of pollution or protection of
       environment and which has been notified 466 in this behalf by the
G      Central Government in the Official Gazette, is installed after the
       31st day of May, 1983 but before the 1st day of April, 1987, in
       any industrial undertaking referred to in sub-clause (i) or sub-clause
       (ii) or sub-clause (iii) of clause (b) of sub-section (2), the provisions
       of sub-section (1) shall have effect in relation to such machinery
H      or plant as if for the words "twenty-five per cent", the words
COMMISSIONER OF INCOME TAX, MADRAS v. MIS.                       965
  LUCAST.V.S.LTD.PADICHENNAI[PASAYAT,J.]
  "thirty-five per cent" had been substituted.                         A
  (3) Where the total income of the assessee assessable for the
  assessment year relevant to the previous year in which the ship or
  aircraft was acquired or the machinery or plant was installed, or,
  as the case may be, the immediately succeeding previous year [the
  total income for this purpose being computed after deduction of B
  the allowance under section 33 and section 33A, but without
  making any deduction under sub-section (1) of this section or any
  deduction under Chapter VI-A is nil or is less than the full amount
  of the investment allowance, -
                                                                       c
  (i) The sum to be allowed by way of investment allowance for that
  assessment year under sub-section (1) shall be only such amount
  as is sufficient to reduce the said total income to nil; and
  (ii) The amount of the investment allowance, to the extent to \\>illch
  it has not been allowed as aforesaid, shall be carried forward to D
  the following assessment year, and the investment allowance to be
  allowed for the following assessment year shall be such amount as
  is sufficient to reduce the total income of the assessee assessable
  for that assessment year, computed in the manner aforesaid, to nil,
  and the balance of the investment allowance, if any, still outstanding E
  shall be carried forward to the following assessment year and so
  on, so, however, that no portion of the investment allowance shall
  be carried forward for more than eight assessment years
  immediately succeeding the assessment year relevant to the
  previous year in which the ship or aircraft was acquired or the F
  machinery or plant was installed or, as the case may be, the
  immediately succeeding previous year.
  Explanation : Where for any assessment year, investment
  allowance is to be allowed in accordance with the provisions of G
  this sub-section in respect of any ship or aircraft acquired or any
  machinery or plant installed in more than one previous year, and
  the total income of the assessee assessable for that assessment year
  [the total income (or this purpose being computed after deduction
  of the allowance under section 33 and section 33A, but without
                                                                       H
    966 SUPREME COURT REPORTS                  [2007] 13 (Addl.) S.C.R.


A       making any deduction under sub-section (1) of this section or any
        deduction under Chapter VI-A] is less than the aggregate of the
        amounts due to be allowed in respect of the asset aforesaid for
        that assessment year, the following procedure shall be followed,
        namely:-
B           (a) The allowance under clause (ii) shall be made before any
        allowance under clause (i) is made; and
            (b) where an allowance has to be made under clause (ii) in
        respect of amounts carried forward from more than one assessment
c       year, 1he amount carried forward from an earlier assessment year
        shall be allowed before any amount carried forward from a later
        assessment year.
        (4) The d~duction under sub-section (1) shall be allowed only if
        the following conditions are fulfilled, namely :-
D
            (i) Tbe particulars prescribed 468 in this behalf have been
        furnished by the assessee in respect of the ship or aircraft or
        machinery or plant;
           (ii) A'.1. amount equal to seventy-five per cent of the investment
E      allowance to be actually allowed is debited to the profit and loss
       account of any previous year in respect of which the deduction is
       to be allowed under sub-section (3) or any earlier previous year
       [being a previous year not earlier than the year in which the ship
       or aircraft was acquired or the machinery or plant was installed or
F      the ship, aircraft, machinery or plant was first put to use] and
       credited to a reserve account (to be called the "Investment
       Allowar1ce Reserve Account") to be utilised -
           (a) For the purposes of acquiring, before the expiry of a period
G      of ten years next following the previous year in which the ship or
       aircraft was acquired or the machinery or plant was installed, a
       new ship or a new aircraft or new machinery or plant [other than
       machinery or plant of the nature referred to in clauses (a), (b) and
       (d) of the second proviso to sub-section (1)) for the purposes of
       the business of the undertaking; and
H
COMMISSIONER OF INCOME TAX, MADRAS v. M/S.                          967
  LUCAS T.V.S. LTD. PADI CHENNAI [PASAYAT,J.]
   (b) Until the acquisition of a new ship or a new aircraft or new A
   machinery or plant as aforesaid, for the purposes of the business
   of the undertaking other than for distribution by way of dividends
   or profits or for remittance outside India as profits or for the
   creation of any asset outside India :
      Provided that this clause shall have effect in respect of a ship B
   as if for the word "seventy-five", the word "fifty" had been
   substituted.
   Explanation : Where the amount debited to the profit and loss
   account and credited to the Investment Allowance Reserve                 C
   Account under this sub-section is not less than the amount required
   to be so credited on the basis of the amount of deduction in respect
   of investment allowance claimed in the return made by the assessee
   under section 139, but a higher deduction in respect of the
   investment allowance is admissible on the basis of the total income
                                                                            D
   as proposed to be computed by the Assessing Officer under
   section 143, the Assessing Officer shall, by notice in writing in this
   behalf, allow the assessee an opportunity to credit within the time
   specified in the notice or within such further time as the Assessing
   Officer may allow, a further amount to the Investment Allowance
   Reserve Account out of the profits and gains of the previous year        E
   in which such notice is served on the assessee or of the immediately
   preceding previous year, if the accounts for that year have not been
   made up; and, if the assessee credits any further amount to such
   account within the time aforesaid, the amount so credited shall be
   deemed to have been credited to the Investment Allowance                 F
   Reserve Account of the previous year in which the deduction is
   admissible and such amount shall not be taken into account in
   determining the adequacy of the reserve required to be credited
   by the assessee in respect of the previous year in which such further
   ~~~~:                                                                    G
       Provided that such opportunity shall not be allowed by the
   Assessing Officer in a case where the difference in the total income
   as proposed to be computed by him and the total income as
   returned by the assessee arises out of the application of the proviso H
    968 SUPREME COURT REPORTS                  [2007] 13 (Addi.) S.C.R.


A       to sub-section (1) of section 145 or sub-section (2) ofthnt section
        or the omission by the assessee to disclose his income :Ully and
        truly.
        (5) Any allowance made under this section in respect of any ship,
        aircraft, machinery or plant shall be deemed to have been wrongly
B       made for the purposes of this Act -
        (a) If the ship, aircraft, machinery or plant is sold or otherwise
        transferred by th~ assessee to any person at any time before the
        expiry of eight years from the end of the previous year in which it
c       was acquired or mstalled; or
       (b) If at any time before the expiry of ten years from the end of
       the previous year in which the ship or aircraft was acquired or the
       machinery or pl<mt was installed, the assessee does not utilise the
       amount credited to the reserve account under sub-section (4) for
D      the purposes of acquiring a new ship or a new aircraft or new
       machinery or plant [other than machinery or plant of' the nature
       referred to in clauses (a), (b) and (d) of the second prm'iso to sub-
       section (1)] for the purposes of the busint'.ss of the undertaking;
       or
E
       (c) If at any time before the expiry of the ten years aforesaid, the
       assessee utilises the amount credited to the reserve acc:ount under
       sub-section (4) for distribution by way of dividends or profits or
       for remittance outside India as profits or for the creation of any
F
       asset outside India or for any other purpose which is not a purpose
       of the business of the undertaking, and the provisions of sub-
       section (4A) of section 155 shall apply accordingly :
           Provided that nothing in clause (a) shall apply- (\)Where the
       ship, aircraft, machinery or plant is sold or otherwise transferred
G      by the assessee to the Government, a local authority, a corporation
       established by a Central, State or Provincial Act or a Government
       company as defined in section 617 of the Companies Act, 1956
       or (1 of 1956); or
       (ii) Where the sale or transfer of the ship, aircraft, machinery or
H
COMMISSIONER OF INCOME TAX, MADRAS v. MIS. 969
  LUCAS T.V.S. LTD.PADI CHENNAI [PASAYAT,J.]
  plant is made in connection with the amalgamation or succession, A
  referred to in sub-section (6) or sub-section (7).
  (6) Where, in a scheme of amalgamation, the amalgamating
  company sells or otherwise transfers to the amalgamated company
  any ship, aircraft, machinery or plant, in respect of which investment
  allowance has been allowed to the amalgamating company under B
  sub-section (1), - (a) The amalgamated company shall continue
  to fulfil the conditions mentioned in sub-section (4) in respect of
  the reserve created by the amalgamating company and in respect
  of the period within which such ship, aircraft, machinery or plant
  shall not be sold or otherwise transferred and in default of any of C
  these conditions, the provisions of sub-section (4A) of section 155
  shall apply to the amalgamated company as they would have
  applied to the amalgamating company had it committed the default;
  and
                                                                         D
  (b) TI1e balance of investment allowance, if any, still outstanding
  to the amalgamating company in respect of such ship, aircraft,
  machinery or plant, shall be allowed to the amalgamated company
  in accordance with the provisions of sub-section (3), so, however,
  that the to\al period for which the balance of investment allowance E
  shall be carried forward in the assessments of the amalgamating
  company and the amalgamated company shall not exceed the
  period of eight years specified in sub-section (3) and the
  amalgamated company shall be treated as the assessee in respect
  of such ship, aircraft, machinery or plant, for the purposes of this F
  section.
  (7) Where a firm is succeeded to by a company in the business
  carried on by it as a result of which the firm sells or otherwise
  transfers to the company any ship, aircraft, machinery or plant, the
  provisions of clauses (a) and (b) of sub-section (6) shall, so far as G
  may be, apply to the firm and the company.
  Explanation: The provisions of this sub-section shall apply only
  where - (i) All the property of the firm relating to the business
  immediately before the succession becomes the property of the
                                                                       H
    970 SUPREME COURT REPORTS                     [2007] 13 (Addi.) S.C.R.


A       company;
        (ii) All 1he Ii abilities of 1he finn relating to 1he business immediately
        before 1he succession become the liabilities of the company; and
        (iii) All 1he shareholders of the company were partners of1he firm
B       immedi.ately before 1he succession.
        (8) The Central Government, if it considers necessary or expedient
        so to do, may, by notification in the Official Gazette, direct that
        1he deduction allowable under this section shall not be allowed in
        respect of any ship or aircraft acquired or any machinery or plant
c       installed after such date as may be specified 4751herein.
        (8A) The Central Government, if it considers necessary or
        expedient so to do, may, by notification in 1he Official Gazette, omit
        any article or thing from 1he list of articles or things specified in 1he
D       Eleven1h Schedule.
        (8B) Notwi1hstanding anything contained in sub-section (8) or 1he
        notification of1he Government oflndia in 1he Ministry ofFinance
        (Department of Revenue) No. G.S.R. 870(E), dated 1he 12th June,
        1986, issued thereunder, the provisions of 1his section shall apply
E       in respect of, - (a)(i) A new ship or new aircraft acquired after
        1he 31st day of March, 1987 but before 1he !st day of April, 1988,
        if the assessee furnishes evidence to the satisfaction of the
        Assessing Officer 1hat he had, before the 121h day of June, 1986,
        entered into a contract for the purchase of such ship or aircraft
F       wi1h 1he builder or manufacturer or owner thereof, as 1he case may
        be;
        (ii) Any new machinery or plant installed after the 31st day of
        March, 1987 but before 1he Ist day of April, 1988, if 1he assessee
G       furnishes evidence to 1he satisfaction of 1he Assessing Officer 1hat
        before the 12th day of June, 1986, he had purchased such
        machinery or plant or had entered into a contract for 1he purchase
        of such machinery or plant with 1he manufacturer or owner of, or
        a dealer in, such machinery or plant, or had, where such machinery
        or plant has been manufactured in an undertaking owned by the
H
    COMMISSIONER OF INCOME TAX, MADRAS v. M/S. 971
      LUCAST.V.S.LTD.PADICHENNAI[PASAYAT,J.]
         assessee, taken steps for the manufacture of such machinery or A
         plant:
             Provided that nothing contained in sub-section (1) shall entitle
         the assessee to claim deduction in respect of a ship or aircraft or
         machinery or plant referred to in this clause in any previous year
         except the previous year relevant to the assessment year B
         commencing on the 1st day of April, 1989;
         (b) A new ship or new aircraft acquired or any new machinery or
         plant installed after the 31st day of March, 1988, but before such
         date as the Central Government, if it considers necessary or c
         expedient so to do, may, by notification in the Official Gazette,
         specify 477a in this behalf.
         (8C) Subject to the provisions of clause (ii) of sub-section (3),
         where a deduction has been allowed to an assessee under sub-
         section (1) in any assessment year, no deduction shall be allowed D
         to the assessee under section 32AB in the said assessment year
         (hereinafter referred to as the initial assessment year) and a block
         of further period of four years beginning with the assessment year
         immediately succeeding the initial assessment year.
                                                                               E
      5. Learned counsel for the appellant submitted that Section 43A(1)
relates to fluctuations of foreign exchange and its effect on the valuation
of the assets. It has nothing to do with the question as to whether it is
allowable in one year. Therefore, the decision relied upon by the High
Court has no application.                                                   F
     6. Learned counsel for the respondent fairly accepted this position.
     7. In that view of the matter, we set aside the impugned order of
the High Court, remit the matter to it for fresh adjudication after formulating
the question oflaw involved.                                                    G
     8. The appeals are allowed to the aforesaid extent. No costs.
S.K.S.                                                   Appeals allowed.