TMI Blog1990 (3) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... to income are taxable. Regarding the allocation of expenses, the ratio of non-taxable receipts and taxable receipts excluding the bank interest and the dividends as adopted in the earlier years was followed. The assessee claimed interest under section 214 on the advance tax of Rs. 41,375. The Income-tax Officer disallowed interest stating that it has been paid after the due date. Aggrieved by this order, the assessee appealed to the Commissioner of Income-tax (Appeals). The assessee urged before the Commissioner that the assessment was wrong inasmuch as the Income-tax Officer had erred in bringing to tax the receipt of Rs. 89,800 relating to fumigation charges (external) and Rs. 5,920 relating to laboratory analysis fees. The Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the circumstances of the case, the Appellate Tribunal is right in law in upholding the Commissioner of Income-tax (Appeals)'s order who held that the fumigation charges (external) of Rs. 89,800 and laboratory analysis fees of Rs. 5,920 are exempt under section 10(29) of the Income-tax Act, 1961 ? (2) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in upholding the Commissioner of Income-tax (Appeals)'s order who directed the Income-tax Officer to allow interest under section 214 on the instalment of advance tax paid by the assessee on March 20, 1978 ?" So far as the first question is concerned, the facts arise as under: The assessee is a warehousing corporation carrying on the fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of godowns or warehouses, and (3) the letting must be for the purpose of storage, processing or facilitating the marketing of commodities. So far as the first ingredient is concerned, there is no dispute in this case at all. The assessee is admitted to be an authority constituted under law for the marketing of commodities. The issue in this case is not regarding the income derived from the letting of godowns or warehouses for storage, processing or facilitating the marketing of commodities but in cases where such activities are carried on where the godown is not actually let. The assessee's main business activity is that of letting out godowns. But fumigation activity is also indulged in respect of goods not stored in the assessee's own g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... connection with the main business activity of the assessee of storing foodgrains. Even otherwise, the view taken by the Tribunal is not correct. Therefore, we have got to answer the first question referred to us in the negative and in favour of the Revenue. So far as the second question is concerned, the scope of section 214 has been fully discussed by the decision of the Gujarat High Court with which we respectfully agree. This decision has been followed by this court in CIT v. G. J. Fernandez [1986] 160 ITR 602. Hence, the view taken by the Tribunal on this aspect of the matter is correct and we answer the second question referred to us is the affirmative and against the Revenue. Answered accordingly. - - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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