IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION INCOME INCOME INCOME TAX REFERENCE NO.34 OF 1995 TAX REFERENCE NO.34 OF 1995 TAX REFERENCE NO.34 OF 1995 The Commissioner of Income Tax Bombay City II Bombay .. Appellant Vs. M/s Maharashtra State Financial Corporation, Bombay ... Respondent with INCOME TAX REFERENCE NO. 68 OF 1995 The Commissioner of Income Tax Bombay City II Bombay .. Appellant vs M/s Maharashtra State Financial Corporation, Bombay .. Respondent Mr.P.S.Sahadevan for Appellant Mr.P.J.Pardiwalla with Mr.Rajesh Poojary i.b Mulla & Mulla Cr.Blunt for Respondent CORAM CORAM CORAM : Dr.S.Radhakrishnan and : Dr.S.Radhakrishnan and : Dr.S.Radhakrishnan and A.V.Nirgude, A.V.Nirgude, A.V.Nirgude, JJ JJ JJ DATE DATE DATE : 14th July, 2008 : 14th July, 2008 : 14th July, 2008 P.C. P.C. P.C. 1. Heard learned counsel for the appellant and learned counsel for the respondent. By the above reference, the following substantial question of law has been referred to : Whether on the facts and in the circumstances of the case, the Tribunal was right in law in upholding the decision of the C.I.T.(A) holding that the statutory deduction u/s 36 (1) (viii) of the I.T.Act 1961 in respect of Financial Corporation has to be calculated on the total income of the assessee before 2 adjusting such deduction and not after such deduction. 2. The learned senior counsel for the respondent-assessee states that the very said question of law was considered by the Hon’ble Supreme Court in Commissioner of Income Tax vs Kerala State Industrial Development Corporation Vol.233 ITR 197 wherein the Supreme Court has very categorically held that the statutory deductions under section 36 (1) (viii) of the Income Tax Act, 1961 in respect of financial Corporation is to be calculated on total income of the assessee without any deductions. In view thereof, the above question is answered accordingly in favour of the asseesee and against the revenue that the statutory deductions under section 36 (1) (viii) of Income tax Act, 1961 in respect of financial Corporation is to be calculated on total income of the asseessee without any deductions. { A.V.Nirgude, J } { Dr.S.Radhakrishnan, J } A.V.Nirgude, J } { Dr.S.Radhakrishnan, J } A.V.Nirgude, J } { Dr.S.Radhakrishnan, J }