1992 (4) TMI 84

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....d the decision of CIT(A) to this extent. In respect of interest paid to directors and shareholders on current account, the CIT(A) has followed its earlier order in deleting the disallowance. Revenue is aggrieved. The learned counsel for the assessee Shri Vinod Chandiok has placed copy of the decision of the Tribunal in the case of assessee for asst. yr. 1982-83 and stated that the issue is covered by the said decision in favour of the assessee. The Tribunal in ITA No. 2023/Del/87 asst. yr. 1982-83 vide order dt. 27th March, 1990 has ruled that no disallowance under s. 40A(8) should be made in the case of the assessee on interest paid to the directors and shareholders in respect of the amounts in respect of their current accounts. The decisi....

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.... Court in the case of CIT vs. Pyare Lal (1992) 101 CTR (Ori) 247. Shri Chandiok contended that the Hon'ble Supreme Court having rejected the Special Leave Petition against the decision of the Patna High Court in the case of Jamshedpur Motor Accessories Store's case, the disallowance may be deleted. 7. The learned Departmental Representative, on the other hand, contended that this case falls within the jurisdiction of Delhi High Court and accordingly its decision in the case of Sanghi Motors vs. Union of India (1991) 91 CTR (Del) 15 : (1991) 187 ITR 70 (Del) and Escorts Ltd. vs. Union of India & Ors. (1991) 93 CTR (Del) 169 : (1991) 189 ITR 81 (Del) have binding effect. 8. On careful consideration of rival contentions, we are of the vi....

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....rt in the case of Jamshedpur Motor Accessories Store's case have taken a different view. Calcutta High Court in the case of CIT vs. Srijagannath Steel Corpn. (1991) 191 ITR 676 (Cal) and Orissa High Court in the case of Pyare Lal have also concurred with the view of Patna High Court. Allahabad High Court in the case of CIT vs. S.B. Foundry (1990) 185 ITR 555 (All) has declined to call for a reference against the decision of the Tribunal holding the proviso to be applicable retrospectively. The Hon'ble Supreme Court has dismissed the Special Leave Petition filed by the Revenue against the decision of the Patna High Court in the case of Jamshedpur Motor Accessories Store's case. However, since this case falls within the jurisdiction of Delhi ....