Concurrent jurisdiction under section 125A did not exclude section 144B; interest deduction claims under the Act were also rejected.

Section 144B was not excluded merely because concurrent jurisdiction had been conferred on the IAC under section 125A; actual exercise of that jurisdiction was necessary for the exclusion in section 144B(7) to apply, so the limitation objection failed and section 144B remained applicable. Interest liability was also held not deductible under sections 36, 37 or 80VV, as the cited authorities treated the claimed interest as outside those allowance provisions, so the disallowance was upheld. The appeal succeeded only on limited ancillary remand grounds, while the substantive challenges to limitation and interest deduction were rejected.

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Issues: (i) Whether section 144B of the Income-tax Act, 1961 was excluded where concurrent jurisdiction had been conferred on the IAC under section 125A and the assessment was therefore time-barred; (ii) Whether interest liability was allowable as deduction under sections 36, 37 or 80VV of the Income-tax Act, 1961.

Issue (i): Whether section 144B of the Income-tax Act, 1961 was excluded where concurrent jurisdiction had been conferred on the IAC under section 125A and the assessment was therefore time-barred.

Analysis: Concurrent jurisdiction under section 125A does not by itself displace section 144B. The exclusion under section 144B(7) operates only where the Dy. Commissioner exercises the powers or performs the functions of an Assessing Officer in pursuance of an order under section 125A. The statutory scheme indicates that actual exercise of the conferred powers is necessary, and mere conferment is insufficient. As the IAC had not in fact exercised the concurrent jurisdiction, the extended time available under the relevant limitation provision remained available.

Conclusion: The objection of limitation failed, and section 144B was held applicable against the assessee.

Issue (ii): Whether interest liability was allowable as deduction under sections 36, 37 or 80VV of the Income-tax Act, 1961.

Analysis: The claim for deduction of interest was examined in the light of the settled view that such interest does not qualify for allowance under the claimed provisions. The cited authorities were applied to reject the contention that the expenditure was deductible as business expenditure or otherwise allowable under the invoked sections.

Conclusion: The disallowance of interest was upheld against the assessee.

Final Conclusion: The appeal succeeded only to the limited extent of remand on certain ancillary grounds, while the substantive challenge to limitation and the claim for interest deduction were rejected.

Ratio Decidendi: Section 144B is excluded by section 144B(7) only when the authority vested with concurrent jurisdiction under section 125A actually exercises that jurisdiction; mere conferment of concurrent jurisdiction is not enough.

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