9911796707
TMI Blog2011 (8) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... l filed by the Revenue. Being dissatisfied, the assessee has come up with the present appeal. The facts giving rise to filing of this appeal may be summed up thus: a) The appellant is a registered Partnership Firm carrying on business of giving loans and advances and the present appeal arises out of assessment for the Assessment Year 1993-94, of which the Previous Year ended on 31st March, 1993. b) For the Assessment Year under consideration, the appellant filed a return of income on 3rd February, 1994 disclosing the total income of Rs.1,41,540/-. The return was processed under Section 143(1) (a) of the Act and notice was issued under Section 143(2) of the Act. In making the assessment, the Assessing Officer disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able on the borrowed money. It was further held that in working out the disallowance out of the amount of interest debited to the profit and loss account, the assessee should be allowed the benefit accruing from liberty to advance loans aggregating to Rs.73,24,200/- free from interest without in any way adversely affecting its claim for deduction of interest liability. Thus, the CIT (Appeals) deleted the addition of Rs.24,01,770/- and restricted the disallowance to Rs.1,39,753/-. e) Being dissatisfied, the Revenue preferred an appeal before the Tribunal below and the Tribunal by the order impugned set aside the order passed by the Commissioner of Income-tax (Appeals) and remanded the matter to the Assessing Officer to decide the afo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er interpretation of Section 36(1)(iii) of Income Tax Act, 1961 the direction of the Tribunal that if borrowed funds have been diverted to interest free advance then interest payable on borrowed funds is disallowable is sustainable in law. "(ii) Whether the Tribunal acted legally is directing to disallow interest proportionately or otherwise by calculation of the rate of interest on which the rate of interest was paid or payable on borrowed funds. "(iii) Whether on the facts and in the circumstances of the case the order of remand by the Tribunal is in accordance with law." At the time of hearing, Mr. Dutta, the learned Advocate appearing on behalf of the appellant, restricted his submission only to question no. (iii ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in exercise of writ-jurisdiction interfered with an order of an original authority having jurisdiction notwithstanding the provisions of appeal before the Collector against such order. In such a situation the Supreme Court held that even if the order of the first authority, in that case, Nazul Officer, required interference, it was for the appellate authority to look into it and take a decision one way or the other and it was not an extraordinary case which warranted direct interference by the High Court under Article 226 of the Constitution. The Supreme Court pointed out that the Nazul Officer had adverted to a relevant fact that the Government, while renewing the lease of 3.13 acres of land from March 14, 1999 to March 13, 2029 in favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccounts of the assessee, a State Government Corporation, not having been audited by the office of the Comptroller and Auditor General, the Assessing Officer treated the assessee's return as a non est and passed order of assessment under Section 144 of the Act. The CIT (A) affirmed such order but on a further appeal, the Tribunal set aside the assessment and directed assessment with audited accounts submitted by the assessee with further direction the income to be assessed was to be at a figure less than that declared by the assessee in its return. On a rectification application by the assessee, the Tribunal allowed the application but directed that the income should not be assessed at a figure assessed by the Assessing Officer under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
