Judgment

Mrs. Sujata V. Manohar, J.-Civil Appeal Nos. 2544-45 of 1988 pertain to assessment year 1972-73 while Civil Appeal Nos. 642-48 of 1989 pertain to assessment years 1965-66 to 1971-72. The Income-tax Appel­late Tribunal had referred the following questions to the High Court for determination under Section 256(1) of the Income-tax Act, 1961:-

At the instance of the Revenue :

“Assessment year 1965-66:

Whether, on the facts and in the circumstances of the case, the Tribu­nal was justified in law in holding that the hire charges of Rs. 56 received by the assessee-company for letting out the plant and machin­ery to the contractors were not taxable?

Assessment year 1966-67:

(1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the hire charges of Rs. 7,224 received by the assessee-company for letting out of the plant and machinery to the contractors were not taxable?

(2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the royalty of Rs. 8,530/- received from the contractor was not taxable as it was of capital nature and not revenue?

Assessm