JUDGMENT

Ruma Pal, J. — The assessment year in question is 1978-79. The two questions which are to be answered in this appeal are:

i)Whether the appellant is liable to be taxed under the Income Tax Act, 1961 (referred to hereinafter as the "Act") in respect of the interest on doubtful advances credited to the interest suspense account?

ii)Whether two separate limits apply for the purposes of computing disallowance under Section 40A (5) of the Act where an employee retires and ceases to be in employment during the previous year, so that one limit will apply in respect of the amounts and benefits received by him as an employee and another for the amounts and benefits received by him as a former employee.

2. The High Court answered both the questions in favour of the Revenue and against the Assessee.

3. Being aggrieved the appellant has approached this Court.

4. As far as the first question is concerned, the High Court answered it in the affirmative relying on the decision of this Court in State Bank of Travancore vs. Commissioner of Income Tax1. In the decision of State Bank of Travancore Vs. Commissioner of Income Tax the minority opinion expressed by Tulzapurkar, J, was that the stic