S. Ranganathan, J.
1. The Income-tax Appellate Tribunal, Delhi Bench ' B ', has referred for our decision the following question under Section 66(1) of the Indian I.T. Act, 1922 :
' Whether, on the facts and in the circumstances of the case, the assessed was entitled to deduction of Rs. 9,000 representing commission paid on borrowing shares for the purpose of pledging them as security to the income-tax department for securing stay of recovery of taxes, in the computation of profits and gains of business of the assessed '
2. The reference relates to the assessment year 1961-62, the previous year for which was the calendar year 1960. The Tribunal has answered the above question in the negative following the order passed by the Tribunal for an earlier year and none of the orders on record or the statement of the case give the full details of the nature of the amount of Rs. 9,000 which was claimed as a deduction by the assessed. However, the references at the request of the assessed for the earlier assessment years have been decided by the Punjab and Haryana High Court and have been reported as Dalmia Dadri Cement Ltd. v. CIT  86 ITR 577 and . We shall, thereforee, refer to the brief facts relevant for the decision as set out in the judgment reported in  86 ITR 577. The claim made by the assessed is for the deduction of commission of Rs. 9,000 paid by it to Bhriguraj Charity Trust. The commission was paid at 1% per annum on the face value (Rs. 9,00,000) of 9,000 preference shares held by the above trust in the assessed-company. The above commission was paid as the shares of this trust were borrowed by the assessed and were pledged with the Commissioner in order to secure stay of recovery of income-tax pending disposal of appeals against the orders of the ITO. The claim of the assessed before the department was that these amounts of commission had been wholly and exclusively expended for the purpose of business carried on by the assessed. This contention failed with the authorities below and also the Tribunal and also before the Punjab and Haryana High Court in the two decisions above referred to.
3. Mr. Bishamber Lal, learned counsel for the assessed, however, submits that the decisions of the Punjab and Haryana High Court require reconsideration in view of the decision of the Supreme Court in CIT v. Birla Cotton Spinning and Weaving Mills Ltd. : 82ITR166(SC) . In that case, the assessed-company had spent amounts for engaging lawyers and conducting proceedings before the Investigation Commission and in courts where the virus of the statute under which the Commission was constituted were challenged. The question was whether the law charges so incurred in connection with the proceedings before the Investigation Commission could be deducted in computing the profits of the business of the assessed. This question was answered by the Supreme Court in the affirmative. The Supreme Court held that the law charges were expenses incurred for the preservation and protection of the assessed's business from any process or proceedings which might have resulted in the reduction of its income and profits. Even otherwise the expenditure was said to be incidental to the business and was necessitated or justified by commercial expediency as it was incurred by the assessed in opposing a coercive Government action with the object of saving taxation and safeguarding business. The court further pointed out that the earning of profits and the payment of taxes were not isolated and independent activities of a business. These activities are continuous and take place from year to year during the whole period for which the business continues. If the assessed takes any steps for reducing its liability to tax which resulted in more funds being left for the purpose of carrying on the business there was always the possibility of higher profits and expenditure incurred by a trader in endeavoring to correct the mistake is a disbursement laid out for the purpose of his trade.
4. Relying very strongly on the above observations of the Supreme Court counsel contends that the commission paid by the assessed to Birla Cotton Spinning and Weaving Mills Ltd. (sic) was paid in order that the company might be able to furnish security to the department and thus protect itself from coercive action by the department in recovering taxes on the basis of incorrect and excessive assessments which were the subject-matter of appeal before the authorities. Learned counsel also referred to several other authorities which show that expenses incurred by an assessed in legal proceedings for correction of income-tax assessment or correct framing of such assessments would be deductible as business expenditure I D. S. Bist and Sons v. CIT : 85ITR254(Delhi) , Modi Sugar Mills Ltd. v. CIT : 90ITR201(All) , Modi Industries Ltd. v. CIT : 110ITR855(All) , CIT v. Khalsa Nirbhai Transport Co. (P.) Ltd. , CIT v. Cannon Dunkerley & Co. Ltd. : 119ITR595(Bom) . He submitted that the principle applicable to the present case should be no different and that, thereforee, the sum of Rs. 9,000 is a deductible expenditure.
5. On the other hand, Mr. Varma, learned counsel for the department, pointed out that in Dalmia Dadri Cement Ltd. v. CIT , the Punjab High Court has taken note of the arguments based on Birla Cotton Spinning and Weaving Mills Ltd. : 82ITR166(SC) and held that this decision of the Supreme Court did not cast any doubts on the view that had been expressed earlier in Dalmia Dadri Cement Ltd, v. CIT  86 ITR 577. He submitted that having regard to the fact that the identical question has already been decided in the case of the same assessed by a High Court, this court should, in the interests of uniformity and consistency, follow the earlier decision even assuming that there is any scope for reconsideration. But Mr. Varma proceeded to say that there is no such scope for reconsideration. He invited our attention to certain decisions in which the interest paid by the assessed in connection with the payment of tax had not been allowed as a deduction : CIT v. Oriental Carpet . ; Waldies Ltd. v. CIT : 110ITR577(Cal) , Thapar v. CIT : 114ITR331(Cal) , East India Pharmaceutical Works Ltd. v. CIT : 114ITR591(Cal) and certain other earlier cases. He pointed out that the Punjab High Court itself has made a distinction between the two types of cases, of litigation expenditure on the one hand and interest or commission payments of the present type on the other. Further, he drew our attention to Sections 80V and 80VV which have made subsequent provision permitting the deduction of the above amounts but only with effect from assessment year 1976-77.
6. If the matter had been rest integra before us we might perhaps have been inclined to accept the contention of the learned counsel for the assessed. In principle, it seems to us, there may not be any difference between expenditure incurred by an assessed for conducting legal proceedings to reduce his liability to tax and the expenditure incurred by him of the nature presently in question. In substance what has happened is that the assessed has been subjected to assessments which it considers erroneous and excessive. It has preferred appeals and pending the appeals it had to obtain stay of recovery of tax as the business is to progress in normal course and earn its profits. Though there are no details before us of the tax demands against the assessed, it appears that it has given security to the extent of Rs. 9 lakhs at least which indicates that there were substantial amounts which were being sought to be recovered from the assessed and of which it was necessary, in the interests of business of the assessed, to avoid coercive recovery. The only way by which it could do it was to either obtain an overdraft or loan and pay interest thereon or, as in the present case, obtain some security on the payment of commission thereforee. This expenditure, thereforee, can be said to be analogous to the litigation expenditure which has been allowed in a number of cases.
7. However, we express no concluded opinion on the above issue. In our opinion, this reference should be disposed of bearing in mind the eminent desirability of uniformity of construction in an all-India statute like the Income-tax Act. Courts have held that the considered opinion of another High Court should be followed unless there are overriding reasons for taking a divergent view (Kanga and Palkhivala's The Law and Practice of Income-tax, seventh edition, volume I, page 5). This will be particularly more so in a case where the opinion of another High Court is in the case of the same assessed and on the same point in identical circumstances for two years and after considering the Birla's case : 82ITR166(SC) . That apart, there is also the further feature that, even after the decision of the Supreme Court in the case of Birla Cotton Spinning and Weaving Mills Ltd. : 82ITR166(SC) , judicial decisions still show a divergence of view regarding the deductibility of interest payments in connection with the liability to pay income-tax. In these circumstances, we refrain from taking a view different from that taken by the Punjab High Court in the case of the assessed itself for the earlier years and answer the question referred to us in the negative and against the assessed.
8. In the circumstances of the case, however, we make no order as tocosts.