Commissioner of Income Tax vs S. Ramanathan

V.S. Sirpurkar, J.

The questions referred to us at the instance of the revenue are as follows :

Whether the Tribunal was right in law in holding that the interest of Rs. 79,739 due to Mercantile Credit Corpn. is allowable as an expenditure

u/s 57(iii) of the Income Tax Act, 1961 ?

Whether the Tribunal was right in law in holding that the interest would constitute an expenditure, even though the shares were not allotted to the

assessee and there was no income available for consideration ?

At the outset, the learned senior standing counsel for the department makes a statement that these questions are covered against the revenue by

a decision of this court in the case of Commissioner of Income Tax Vs. P.L. Ramiah, . Since a fair statement comes from the revenue against its

own interest, there will be no necessity to hear the assessee in whose favour the order would naturally go. The questions are, therefore, answered

in favour of the assessee and against the revenue. No costs.