THE COMMISSIONER OF INCOME TAX,LUCKNOW vs M/S. NARANG DAIRY PRODUCTS,LUCKNOW.

The Supreme Court addressed the applicability of Section 34(3)(b) of the Income Tax Act in the context of development rebate withdrawal. The Court held that the Income Tax Appellate Tribunal was justified in ruling that there was no 'sale' or 'transfer' of machinery under the lease agreement, thus the withdrawal of the development rebate was improper. The appeal by the Revenue was dismissed, affirming the Tribunal's decision and the High Court's rejection of the Revenue's application under Section 256(2).