REPORTABLE IN SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL No.3148 OF 2019 (Arising out of S.L.P.(C) No.7118 of 2018) Principal Commissioner of Income Tax 8 .Appellant(s) VERSUS M/s Yes Bank Ltd. .Respondent(s) JUDGMENT Abhay Manohar Sapre, J. 1. Leave granted. 2. This appeal is filed against final judgment and order dated 01.08.2017 passed by High Court of Judicature at Bombay in ITA No.599/2015 whereby High Court dismissed appeal filed Signature Not Verified by appellant herein. Digitally signed by ASHOK RAJ SINGH Date: 2019.03.15 17:52:21 IST Reason: 1 3. This appeal involves short point as would be clear from facts stated infra. 4. appellant is Union of India (Income Tax Department) and respondent Bank is assessee. 5. In course of assessment proceedings of respondent assessee(Bank) for Assessment Year 2007 2008, question arose as to whether respondent assessee(Bank) was entitled to claim deduction under Section 35 D of Income Tax Act, 1961 (for short, Act ) for Assessment Year in question. In other words, question arose as to whether respondent Bank is industrial undertaking so as to entitle them to claim deduction under Section 35 D of Act. 6. case of respondent was that they, being industrial undertaking, are entitled to claim deduction under Section 35 D of Act. 2 Assessing Officer passed order dated 31.10.2009 which gave rise to proceedings before Commissioner under Section 263 of Act which resulted in passing of adverse order dated 14.11.2011 by Commissioner. 7. This gave rise to filing of appeal by respondent before ITAT against order of Commissioner. By order dated 05.12.2014, ITAT allowed appeal which gave rise to filing of appeal by Revenue (Income Tax Department) in High Court under Section 260 of Act. 8. By impugned order, High Court dismissed appeal after hearing both parties giving rise to filing of this appeal by way of special leave in this Court. 9. So, short question that arises for consideration in this appeal, is whether High 3 Court was justified in dismissing appellant's appeal. 10. Having heard learned counsel for parties and on perusal of record of case, we are constrained to allow appeal, set aside impugned order and remand case to High Court for deciding appeal afresh on merits in accordance with law. 11. In our view, need to remand case to High Court is called for due to following reasons. 12. First, High Court did not frame any substantial question of law as is required to be framed under Section 260 of Act though heard appeal bipartite. In other words, High Court did not dismiss appeal in limine on ground that appeal does not involve any substantial question of law; Second, High Court 4 dismissed appeal without deciding any issue arising in case saying that it is not necessary. (see para 6). 13. Third, main issue involved in this appeal, as rightly taken note of by High Court in para 6, was with regard to applicability of Section 35 D of Act to respondent assessee(Bank). It was, however, not decided. 14. In our view, High Court should have framed substantial question of law on applicability of Section 35 D of Act in addition to other questions and then should have answered them in accordance with law rather than to leave question(s) undecided. 15. It was brought to our notice that issue with regard to applicability of Section 35 D of Act to respondent Bank is already pending consideration before High Court at instance 5 of respondent in one appeal. If that be so, both appeals, in our view, should be decided together. 16. It is for all these reasons, we are of view that impugned order is not legally sustainable. 17. In view of foregoing discussion, appeal succeeds and is accordingly allowed. impugned order is set aside. appeal is accordingly remanded to High Court for its decision on merits in accordance with law along with another appeal, if pending, after framing proper substantial question(s) of law arising in case. 18. We have not expressed any opinion on merits of case having formed opinion to remand appeal to High Court for its disposal on merits afresh. High Court will accordingly decide appeal uninfluenced by any 6 observations made in impugned order and this order. ...................................J. [ABHAY MANOHAR SAPRE] ... ..................................J. [DINESH MAHESHWARI] New Delhi; March 15, 2019 7 Principal Commissioner of Income-tax-8 v. Yes Bank Ltd