COMMISSIONER OF INCOME-TAX VS J.K. BANKERS
1993 P T D 1489
[200 I T R 602]
[Allahabad High Court (India)]
Before Anshuman Singh and RK Gulati JJ
COMMISSIONER OF INCOME-TAX
Versus
J.K. BANKERS
Income-tax Application No. 64 of 1991, decided on 27/02/1992.
Income-tax-----
----Reference---Firm---Business expenditure---Tribunal justified in holding that net amount paid to partner had to be disallowed---Question covered by decision of Supreme Court---Question is academic---Could not be referred-- Indian Income Tax Act, 1961, Ss.40(b) & 256.
Only the net amount paid by the firm to a partner after adjusting interest paid by him to the firm should be disallowed under section 40(b) of the Income Tax Act, 1961, irrespective of the fact that the amount of interest is received by him in a capacity other than the capacity in which he paid interest to the firm.
Keshavji Ravji & Co. v. CIT (1990)183 ITR 1 (SC) fol.
Held, that the question of disallowance under section 40(b) sought to be raised was covered by the decision of the Supreme Court in Keshavji Ravji & Co. v. CIT (1990) 183 ITR 1 and was, therefore, academic and could not be referred.
Standing Counsel for the Commissioner.
R.S. Agarwal for the Assessee.
JUDGMENT
This is an application filed by the Commissioner of Income-tax, (Central), Kanpur, under section 256(2) of the Income Tax Act, 1961, relating to the assessment year 1979-80 with a prayer that a direction be issued by this Court to the Income-tax Appellate Tribunal to draw up a statement of the case and refer the following question for the opinion of this Court:
"Whether in law and on the facts of the case, the Income-tax Appellate Tribunal was justified in arriving at a conclusion that only net amount paid by the firm to a partner after adjusting interest paid by him to the firm should be disallowed under section 40(b) of the Income Tax Act, 1961, irrespective of the fact that the amount of interest is received by him in a capacity other than a capacity in which he paid interest to the firm of which he is partner in the firm?"
We have heard learned Standing Counsel for the Department and Sri R.S. Agarwal, appearing for the assessee opposite-party.
The question sought to be raised by this application is squarely covered by the decision of the Supreme Court in Keshavji Ravji & Co. v. CIT (1990) 183 ITR 1. The view taken by the Tribunal being in consonance with the view taken by the Supreme Court, the question sought to be referred is wholly academic and, in our opinion, no stat able question of law arises.
The application is, accordingly, rejected. There shall be no order as to costs.
M.BA./2400/TApplication rejected.