Judgment G.C.Bharuka, J. 1. This reference under Sec. 256(1) of the Income tax Act, 1961, involves the following question of law : " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in directing the Income-tax Officer to include loans and borrowings in the capital employed for grant of relief under Sec. 80J of the Act ?" 2. The reference relates to the assessment year 1977-78. For answering the question referred by the Tribunal, it is not necessary to deal with the facts of the case since the issue at hand is no more res integra and stands conclusively decided by the Supreme Court in the case of Lohia Machines Ltd. V/s. Union of India [1985] 152 ITR 308, wherein it has been held that (at page 356) : " Sub-rule (3) of Rule 19A of the Income-tax Rules, 1962, in so far as it provided for the exclusion of borrowed monies and debts and particularly long-term borrowings in the computation of the capital employed by a new industrial undertaking for the purposes of the tax exemption could not be said to be outside the rule-making authority conferred on the Central Board under Sec. 80J(1) of the Income-tax Act, 1961, and was a perfectly valid piece of subordinate legislation." 3. In the above view of the matter, the Tribunal was not justified in law in directing the Income-tax Officer to include loans and borrowings in the capital employed for grant of relief under Sec. 80J of the Act. Consequently, the question referred to this court is answered in the negative, i.e., against the assessee and in favour of the Department. In the circumstances of the case, there shall be no order as to costs. 4. Let a copy of this judgment be transmitted to the Assistant Registrar, Income-tax Appellate Tribunal, Patna Bench, Patna, in terms of Sec. 260 of the Act. B.C.Basak, J. 5 I agree.