SC: SC’s pronouncements which aren’t strictly ratio decidendi still bind HCs

The Hon’ble Supreme Court, on 9th July 2019, in the matter of The Peerless General Finance and Investment Company Ltd. v. Commissioner of Income Tax observed that a pronouncement by the Supreme Court, even if it cannot be strictly called the ratio decidendi of the judgment, would certainly be binding on the High Court.

The Hon’ble Supreme Court observed that:

A pronouncement by this Court, even if it cannot be strictly called the ratio decidendi of the judgment, would certainly be binding on the High Court. (Para 10)

The character of the transaction being clearly a capital receipt in the hands of the assessee cannot possibly be taxed as income in the assessee’s hands. (Para 12)

Copy of judgement: Judgement_11th-Jul-2019

-Tushar Kaushik

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