JUDGMENT
Arijit Pasayat, C.J.
1. At the instance of the Revenue, the following question has been referred for the opinion of this court under Section 256(1) of the Income-tax Act, 1961 (in short “the Act”), by the Income-tax Appellate Tribunal, Delhi Bench “D” (in short “the Tribunal”) :
“Whether, on the facts and in the circumstances of the case, the Tribunal was right in confirming the order of the Commissioner of Income-tax (Appeals) to give rebate in the tax payable to the extent of Rs. 67,785 for the amount deposited in the IDBI in lieu of surcharge in accordance with the provisions of Section 2(6) and (8) of the Finance Act, 1976, although for the assessment year 1978-79 tax was to be paid in accordance with the provisions of the Finance Act, 1978, which did not provide for such concession ?”
2. The dispute, as the question itself indicates, relates to the assessment year 1978-79.
3. The factual position, which is almost undisputed, is essentially as follows :
For the assessment year in question the previous year ended on June 30, 1977. The assessed, a company, was assessed under Section 143(3) read with Section 144B of the Act. For the assessment year in question the asses-see filed its return covering a period of 18 months since the assessed was allowed to change the previous year by the Income-tax Officer (in short “the ITO”), by order dated April 7, 1977. The assessed deposited a sum of Rs. 82,500 with the Industrial Development Bank of India (in short “the I.D.B.I.”) in lieu of the surcharge on income-tax in terms of Section 2(6) and (8) of the Finance Act, 1976 (in short “the Finance Act”) read with the Companies Deposits (Surcharge on Income-tax) Scheme, 1976 (in short “the Scheme”), dated August 28, 1976. The assessed made the deposit on December 13, 1976. The Income-tax Officer did not allow the claimed credit to the assessed. The matter was carried in appeal before the Commissioner of Income-tax (Appeals) (in short “the CIT(A)”). The said authority held that under the provisions of the Finance Act and the Scheme in a ease where the amount of deposit so made is equal to or exceeded the amount of surcharge on income-tax, the surcharge on income-tax payable by the company for the relevant assessment year shall be nil. In the assessed’s case, the gross demand is surcharge was Rs. 67,787 as against which the deposit of Rs. 82,500 was made. The Income-tax Officer was, therefore, directed to treat the demand on surcharge as nil. Against the relief granted, the Revenue filed an appeal before the Tribunal. The Tribunal noticed that the accounting period relevant to the assessment year under appeal was comprised of 18 months and the assessed was allowed to change the previous year. The period comprised in the accounting period relevant to the assessment year, thus, worked out as January 1, 1976, to June 30, 1977. Undisputedly, the assessed had deposited Rs. 82,500 with the I.D.B.I, in lieu of surcharge in terms of the provisions referred to above. As the accounting period comprised 18 months and change in the previous year was permitted, there was no assessment for the assessment year 1977-78. Accordingly, the assessed had claimed relief as credit under the Scheme. That being the position, it was held that the assessed’s claim was allowable. On being moved for reference, the question as stated above was referred for opinion of this court.
4. We have heard learned counsel for the parties. The stand of learned counsel for the Revenue was that the claim was not allowable on the facts. On the other hand, learned counsel for the assessed submitted that the Scheme was clearly applicable.
5. In order to appreciate the correct position, it would be necessary to deal with the relevant clauses. Clause (3) of the Scheme reads as follows (see [1976] 105 ITR (St.) 12) :
“3. Deposit when to be made.–
(1) A deposit in lieu of payment of surcharge on income-tax under Sub-section (6) of Section 2 of the Finance Act, 1976 (66 of 1976), may be made by a company at any time before the last Installment of advance tax is due in its case.
(2) A deposit in lieu of payment of surcharge on income-tax under Sub-section (8) of Section 2 of the Finance Act, 1976 (66 of 1976), may be made by a company at any time during the financial year commencing on the 1st day of April, 1976.
(3) A deposit under sub-paragraph (1) or sub-paragraph (2) may be made either in one lump sum or in two or more Installments.”
6. A bare reading of the provisions makes it clear that the deposit in lieu of payment of surcharge on income-tax under Sub-section (6) of Section 2 of the Finance Act is to be made by a company or the assessed at any time before the last Installment of advance tax is due in its case and under Subsection (8) of Section 2 of the Finance Act, the deposit is to be made by the company or the assessed at any time during the financial year commencing on the 1st day of April, 1976. Undisputedly, the assessed made the deposit on December 13, 1976, i.e., before the last Installment of advance tax in its case was payable. The deposit had already been made in the financial year commencing on the first day of April, 1976. In view of the undisputed position that the Income-tax Officer had permitted change of previous year and the period covered was 18 months and since there was no assessment for the year 1977-78, the income of the assessed, which could be the subject-matter of the assessment for the said assessment year, was subjected to assessment and charge of income-tax during 1978-79. In that view of the matter, the assessed was entitled to claim relief in lieu of surcharge payable. The view of the Commissioner of Income-tax (Appeals) as affirmed by the Tribunal cannot be faulted. The question, therefore, is answered in the affirmative, in favor of the assessed and against the Revenue.
7. The reference is disposed of accordingly.