( 1 ) THE Tribunal, Allahabad, has referred the following question of law under Section 256 (2) of the IT Act, 1961 (hereinafter referred to as the Act), for opinion to this Court : whether, on the facts and circumstances of the case, the Tribunal was right in holding that section 154 of the IT Act, 1961, was not applicable ? the reference relates to the asst. yrs. 1977-78 to 1980-81. ( 2 ) BRIEFLY the facts giving rise to the present reference are as under : the applicant is assessed to income-tax in the status of a firm. In the original assessment for the assessment years in question the loss of the firm and unabsorbed depreciation allowance, investment allowance, deductions under Sections. 80hh and 80-I were allocated to the partners for being carried in their individual assessments. After the original assessment had been made, the assessing authority noted that the aforesaid order was erroneous in as much as in view of the decision of this Court in the case of K. T. Wire Products v. Union of India [1973]92 ITR459 (All) allowing of carry forward of loss and unabsorbed depreciation could not have been done in the hands of the partners and, therefore, the ITO issued notices under section 154 to the assessee in respect of four assessment years in question and rectified the original orders on 8th June, 1982 allowing unabsorbed depreciation allowance, investment allowance, etc. without being allocated to the partners for being carry forward in their hands. The order dt. 8th June, 1982 was once again amended under Section 154 of the Act by the ITO on 28th Oct. , 1983 by observing as follows : in view of decision of Allahabad High Court in the case of K. T. Wire Products v. Union of India [1973]92 ITR459 (All) the above order under Section 154 for carrying forward the unabsorbed depreciation in the hands of firm was erroneous. Accordingly, it being the mistake apparent from records rectification was proposed vide notice under Section 154, dt. 2nd May, 1983. Date of hearing was fixed for 12th May, 1983. Despite receiving the notices on 6th May, 1983 neither anyone attended on behalf of the assessee on 12th May, 1983 nor sent any written arguments. It is, therefore presumed that the assessee has no objection to the proposed rectification. Mistake being apparent from record is hereby rectified. 2nd May, 1983. Date of hearing was fixed for 12th May, 1983. Despite receiving the notices on 6th May, 1983 neither anyone attended on behalf of the assessee on 12th May, 1983 nor sent any written arguments. It is, therefore presumed that the assessee has no objection to the proposed rectification. Mistake being apparent from record is hereby rectified. The items to be carried forward in the hands of the firm and in the hands of the partners are as under : unabsorbed depreciation amounting Rs. 4,235 has been allocated to partners as under and they alone would be entitled to carry forward it : (1) Sri Moti Lal 17% 719 (2) Sri Gopi Krishna 17% 719 (3) Sri Vishwanath 17% 719 (4) Sri Shambhoo Nath 16% 677 (5) Sri Satish Chand 16% 677 (6) Sri Santosh Kumar 4% 169 (7) Sri Raj Kumar 5% 212 (8) Sri Purshottam Das 4% 169 (9) Sri Shiv Kumar 4% 169 The firm would carry forward the following item to subsequent year. (1) Unabsorbed investment allowance of asst. yr. 1977-78, Rs. 1,59,056 feeling aggrieved, the applicant preferred appeal before the AAC, who cancelled the order dt. 28th Oct. , 1983 passed by the ITO. Feeling aggrieved, the Revenue filed appeal before the tribunal and the Tribunal reversed the orders of the AAC and restored the order of the ITO on the following observations: we have heard both the sides and have perused the orders of the authorities below for our consideration. It is seen that the ITO following the decision of the Honble Allahabad High Court in the case of K. T. Wire Products [1973]92 ITR459 (All), rectified the earlier order. In our opinion, on the facts and circumstances of the case, the ITO was justified and legally bound to rectify the mistake in view of the above decision. The Honble Allahabad high Court in the case reported in Omega Sports and Radio Works v. CIT (1982)28 CTR80 (All), [1982]134 ITR28 (All), [1982]9 TAXMAN193 (All), held if a decision on the particular point was given by the High-Court of the State, the same is binding on the IT authorities in that State and merely because there was some judicial divergence of opinion amongst the different High Courts, it cannot be said that there was still scope for a debate on the point. That decision is binding. That decision is binding. Accordingly, in the circumstances we reverse the order of the aac impugned before us and restore those of the ITO. ( 3 ) HEARD Sri V. K. Rastogi, learned Counsel for the applicant, and Sri Shambhu Chopra, learned standing counsel for the Revenue and perused the record. ( 4 ) LEARNED counsel for the applicant submitted that decision of this Court in the case of K. T. Wire Products (supra) has been overruled by Supreme Court in the case of Garden Silk Weaving factory v. CIT AIR1991 SC 1322 , [1991]189 ITR512 (SC), JT1991 (5)SC 160 , 1991 (1)SCALE501 , (1991)2 SCC684 , [1991]1 SCR909 and, therefore, the order dt. 28th Oct. , 1983 has rightly been set aside by the AAC as it was not a case of rectification under Section 154 of the Act. Learned standing counsel has submitted that decision of K. T. Wire products of this Court has been overruled by Supreme Court in the Garden Silk Weaving Factory (supra ). However, Supreme Court has held that even unabsorbed depreciation has to be allocated in the hands of the partners and, therefore/the view taken by the assessing authority is in conformity with the decision of Supreme Court, referred to above. ( 5 ) HAVING heard learned Counsel for parties, we find that Supreme Court in the case of Garden silk Weaving Factory (supra) has held that unabsorbed depreciation has to be allocated amongst the partners and like any other loss will be available to the partners for set off against their business income or other income in the same assessment year and the amount of depreciation so remaining unabsorbed in their hands (would be available) for setting off in the hands of the firm in future assessment years. ( 6 ) IN this view of the matter we are of the considered opinion that provision of Section 154 of the act was applicable as there was mistake apparent on the record in the order dt. 8th June, 1982 wherein the assessing authority had failed to allocate carry forward losses of the firm at the hands of the partners. However the ITO should not have restricted the carry forward of unabsorbed depreciation at the hands of partners. 8th June, 1982 wherein the assessing authority had failed to allocate carry forward losses of the firm at the hands of the partners. However the ITO should not have restricted the carry forward of unabsorbed depreciation at the hands of partners. The order should have been that if depreciation remained unabsorbed at the hands of partners during the assessment year in question it would revert back to the firm for the setting off in future assessment years. We, therefore, answer the aforesaid question referred to us partly in favour of the applicant and partly in favour of the revenue. There shall be, however, no order as to costs. . .