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2002 (4) TMI 26 - HC - Income TaxAccounting - Rejection Of Accounts - Estimation Of Profits - The core question raised before us, as is apparent from the question framed at the time of admission, whether the Income-tax Appellate Tribunal was justified in law allowing interest paid to third parties. - There is no doubt about the fact that both expenses, on account of depreciation and interest on borrowings are allowable expenses and without taking into account such expenses net taxable income cannot be determined. In fact there is no dispute about the appropriation towards depreciation, notwithstanding the assessing authority has applied the net profit rate excluding appropriation towards any allowable expenditure. - We are in agreement with the Tribunal for modifying the order passed by the assessing authority by making the net profit rate subject to adjustment towards depreciation and interest on borrowings. - This conclusion, in our opinion, was a pure finding of fact and would not give rise to a question of law much less a substantial question of law unless the finding is shown to be perverse or without any rationale
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