SC Grants Liberty to Present Key Legal Questions in Tax Appeal on Interest Disallowance and Stock Discrepancies.

The SC addressed the appellant's concerns about the HC's omission of substantial questions of law in Tax Appeal No. 1096/2011. The SC granted the appellant(s) the liberty to present two specific questions before the HC regarding interest disallowance and stock discrepancies. The HC was instructed to consider these and any other substantial questions of law that might arise. The SC emphasized the appellant(s)' view of the questions as substantial while allowing the respondent(s) to argue otherwise. The appeal was disposed of with these instructions, and any pending applications were resolved.

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Issues involved:
The High Court's failure to include all substantial questions of law raised by the appellant in Tax Appeal No. 1096/2011.

Judgment Summary:

The appellant(s) raised concerns regarding the High Court's omission of two substantial questions of law in Tax Appeal No. 1096/2011. The Supreme Court, after hearing both parties, granted liberty to the appellant(s) to present the following questions before the High Court:
1. Whether the Appellate Tribunal was correct in deleting the interest disallowance of Rs. 47,40,000/- on account of interest-bearing funds diverted to associate companiesRs.
2. Whether the Appellate Tribunal was correct in deleting the addition of Rs. 9,41,43,486/- made due to the difference between stock as per the books of account and as per the stock statements submitted to the BanksRs. The appellant(s) highlighted that the total tax effect related to the disputed issue amounted to Rs. 3,63,39,680/- for the assessment year 2003-2004 with recurring effect. The High Court was directed to consider these questions and any other substantial question of law that may arise.

It was emphasized that the mentioned questions were deemed substantial by the appellant(s), while the respondent(s) had the liberty to argue otherwise. The Supreme Court clarified that the High Court had the authority to raise additional substantial questions of law if necessary. The appeal was disposed of with these instructions, and any pending applications were also resolved accordingly.

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