Circular No. 691-Income tax dated 5-9-1994

Effect of decision of the Supreme Court in Distributors (Baroda) (P.) Ltd. v. Union of India [1985] 155 ITR 120

No Circular . 341, dated 10-5-1982 (Annex) had been issued in the, wake of the Supreme Court’s judgment in the case of Cloth Traders (P.) Ltd [1979] 118 ITR 243/1 Taxman 335.  This decision was subsequently overruled by the Supreme Court in the case ofDistributors (Baroda) (P.) Ltd v. Union of India [1985] 155 ITR 120/22 Taxman 49 which therefore gives the correct legal position.  It is therefore clarified that Circular No. 341 ceases to have applicability for any assessment year consequent to the decision of Supreme Court in the case of Distributors (Baroda) (P.) Ltd (supra).

Circular : No. 691, dated 5-9-1994.