TMI Blog1982 (9) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... lief under the section in respect of interest thereon. For the earlier assessment year 1976-77 the ITO had allowed the same. However, for these two assessment years, part of the amount is shown to have been borrowed from one Taral Siddharthbhai ('Taral') and the balance from one Swati Siddharthbhai ('Swati'). The assessee claimed the interest due on this amount also under the section. The ITO disallowed this claim on the ground that the amounts in question have not been borrowed for the payment of tax under the Act but were borrowed for the repayment of the earlier loan from Lalbhai Dalpatbhai (HUF). The Commissioner (Appeals) has confirmed this order. 7. The short question for our consideration is whether borrowing from Taral and Swati c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of the Commissioner (Appeals) which, inter alia states the requirements of the section as follows : "Firstly there have to be taxes due from the assessee, secondly borrowings are to be made by an assessee, thirdly those borrowings are to be utilised for the purpose of payment of the due taxes and fourthly interest is to be paid on such borrowed monies." 8. The Commissioner (Appeals) has stated that on the facts it was clear that the borrowings made from Taral and Swati were not utilised for the payment of taxes and, therefore, interest paid to them on such borrowings could not possibly be a valid deduction under section 80V. The learned departmental representative has emphasized that on the date on which the borrowings from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s nothing in the language of the relevant statutory provisions which imposes a further limitation, namely, that if the condition laid down in the section is not satisfied in the very year of commencement of manufacture or production, the benefit of tax holiday will not be available, even if such condition is satisfied in the course of any of the subsequent four years . . . ." This shows that the Court did not go against the language of the section which we are here called upon to do. 11. In this case there is no doubt that when the second loan was taken from Taral and Swati, tax had in fact been paid already, and there was no tax due at all for which the loans could be said to have been taken. The real question then is whether we can cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... albhai Dalpatbhai (HUF). Therefore, there is no need to go against the language of the section. Much has been said about purposive and liberal interpretation. It is time to restore the language of the law to its rightful place. 13. Regarding the circular, it is noticed that it relates to section 24(1)(vi) of the Act. It may be possible to argue that the circular deals with a problem similar to the one in this case but a circular must be applied only to the cases covered by the particular section mentioned therein. No, legal principle can be derived from a circular so as to apply it to other cases. It is not the function of the CBDT to lay down legal principles which can be done only by the Legislature or by judicial bodies. For this reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X
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