Commissioner of Income Tax -I vs R.T. Syntex (P.) Ltd.

S.K. Kulshrestha, J.—By this appeal u/s 260A of the income tax Act, 1961 (for short the Act), the appellant (Revenue) assails the legality and propriety of the order dated 21-7-2006 passed by the ITAT in IT Appeal No. 439 (IInd) of 2004 for Assessment Year 1997-98. The Assessing Officer had disallowed the claim for deduction of the interest paid by the assessee but on appeal, the CIT(A) allowed the deduction of Rs. 28,99,382/- towards the interest paid. The ITAT has affirmed the order of the CIT (A) vide impugned order. The authorities have followed the ratio of the case decided by the Supreme Court in Veecumsees v. CIT [1996] 220 ITR 185 1 in which even where after diversification from the business of jewellery to cinema, when loan was obtained and interest was paid and the assessee had closed down the business of cinema and continued with the business in jewellery, the interest claimed on the amount paid in relation to the cinema, was allowed as deduction. The authorities acted within the scope of their power and the orders of CIT(A) and ITAT do not suffer from any infirmity or illegality. Accordingly, there no question of law in the case, much less question formulated by the appellant. Resultantly, appeal being sans merit, dismissed summarily.