1980 (5) TMI 58

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....Kumar & Co. and Shri Surinder Kumar Jindal respectively this year, that the said interest had been paid on moneys borrowed from these two parties by the assessee for investment in share. According to the ITO though the assessee had claimed deduction of this interest of Rs. 20,557 + Rs.12,440 = Rs. 32,997 the same was not allowable as there was no income chargeable this year under the head "other sources". According to the ITO in terms of s. 57(iii) a deduction could be allowed for expenditure only when there was income chargeable under the head "other sources". Since there was no dividend income from the shares in question the ITO refused to consider the assessee's claim for deduction of the interest. The assessee appealed. 3. The AAC fo....

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....ct and specifically overrided the contra decisions of the Calcutta High Court (47 ITR 1) and of the Patna High Court (32 ITR 377). Shri Aggarwal also invited attention to the copy of the account of the assessee with M/s A. Kumar & Co. (Bombay Branch) wherein the interest paid as well as the commission credits were duly recorded for this year. Shri Aggarwal also filed copies of the assessee's balance sheets as on31st March, 1973showing on the liabilities side the loans payable to A. Kumar & Co. and Surender Kumar Jindal and on the assets side the 400 shares of United Dyechem Industries Pvt. Ltd. held as the assessee's investment. Shri A.K. Ghatak, appearing for the Revenue supported the action of the authorities below. He submitted that no d....