Ramachandran Nair, J.

The appellant, a scheduled bank, claimed deduction of 4/5th of the dividend income received from the Unit Trust of India under proviso (a) to Section 80 M(1) of the Income Tax Act for the assessment year 1994-95. The Assessing Officer however restricted the deduction to 4/5th of 60% of the dividend income from the Unit Trust by taking the view that such income referred to in proviso (a) above referred means 60% of dividend income mentioned in sub-clause(i) of Section 80 M(1) of the Act. Even though, the First Appellate Authority allowed the appeal holding that the appellant is entitled to deduction of 60% on the dividend income from the Unit Trust in terms of proviso(a) to Section 80M(1) of the Act, the Tribunal reversed the order of the First Appellate Authority and restored the assessment. It is against this order of the Tribunal, the assessee has filed this appeal raising two questions of law. Since the questions raised separately or together do not reflect the issue precisely, we re-draft the question as follows:-

Whether the assessee, a scheduled bank is entitled to deduction of 4/5th of the dividend income received from the Unit Trust of India or only 4/5th of 60% of the dividend income from Unit Trust of India under proviso (a) to Section 80M(1) of the I.T.Act., for the assessment year 1994-95?

2. We have heard Sri.P.Balakrishnan, counsel appearing for the appellant and Sri.P.K.R.Menon, Senior Counsel appearing for the respondent.

3. Since the question raised pertains to interpretation of Section 80M, we extract herein below the said section.

"80M. Deduction in respect of certain inter-corporate dividends

.(1) Where the gross total income of a domestic company, in any previous year, includes any income by way of dividends from another domestic company, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of such domestic company, a deduction of an amount equal to,--

.(i) in the case of a scheduled bank or a public financial institution or a State financial corporation or a State industrial investment corporation or a company registered under section 25 of the Companies Act, 1956 (1 of 1956), sixty per cent of the income by way of dividends from another domestic company;

(ii) in the case of any other domestic company, so much of the amount of income by way of dividends from another domestic company as does not exceed the amount of dividend distributed by the first mentioned domestic company on or before the due date;

(Provided that where any domestic company receives any income by way of dividend from the units of the Unit Trust of India established under the Unit Trust of India Act, 1963 (52 of 1963), such domestic company shall, subject to the aforesaid provisions, be eligible for deduction to the extent of---

.(a) four-fifth of such income in respect of the previous year relevant to the assessment year commencing on the 1st day of April, 1994;

.(b) two-fifth of such income in respect of the previous year relevant to the assessment year commencing on the 1st day of April, 1995, and no deduction shall be allowed on such income in respect of the previous year relevant to the assessment year commencing on the 1st day of April, 1996 and any subsequent previous year.]

4. The answer to the question above referred will depend on the meaning of such income as it occurs in provisos (a) and (b) above. While the contention of the assessee is that such income means dividend income from Unit Trust of India, for which the main proviso is introduced by the Finance Act 1993 with effect from 4.1994, the Senior Counsel appearing for the Revenue contended that such income when read with subject to the aforesaid provisions referred to in the main provision means 60% of the dividend income received from the Unit Trust of India because the assessee is covered by clause (i) of Section 80M(1) of the Act. The proviso which is the subject matter o