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2006 (9) TMI 139 - HC - Income TaxDisallowance of interest payment to financial institutions - Applicability of section 43B of the excise duty and sales tax collection - treating the collection as trading receipts - upfront fee paid to the bank for availing of the loan - Capital Or Revenue expenditure - HELD THAT:- The view of the apex court in CIT v. Sivakami Mills Ltd. [1997 (2) TMI 13 - SUPREME COURT] was subsequently followed in Vikram Mills Ltd. v. CIT[1998 (6) TMI 22 - GUJARAT HIGH COURT] and in Mihir Textile Ltd. v. CIT [2000 (8) TMI 20 - GUJARAT HIGH COURT], holding that the bank guarantee commission was a revenue expenditure and hence allowable as deduction in computing the income. Thus, we find no substantial question of law to be considered in this appeal with regard to the first issue. Applicability of section 43B - Both the CIT(A) and the Tribunal, finding that there was no evidence with regard to the actual payment of the dues, had rightly set aside the order of the Assessing Officer and remanded the matter with a direction to re-examine the issue and to allow deduction u/s 43B if the amount towards sales tax and excise duty has been paid to the Government before the due date of filing of return, or otherwise, to confirm the addition. Thus, No substantial question of law to be considered with regard to the second issue. Disallowance of interest payment - We do not see any substantial question of law in this regard as the Tribunal has only remanded the matter to the Assessing Officer to re-examine the issue with regard to the actual date of payment of interest to the financial institutions, as contemplated under the proviso to section 43B of the Act. Accordingly, finding no substantial question of law that arises for our consideration in this tax case (appeal), the same is dismissed.
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