2011 (3) TMI 934

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....oner has challenged the notice dated May 28, 2001, issued by the respondent under section 148 of the Income-tax Act, 1961 ("the Act"), reopening the petitioner's assessment for the assessment year 1994-95.  2. The petitioner, a registered firm, carries on business of ship breaking. For this purpose it purchases ships that are not sea worthy from sellers usually based abroad. The transactio....

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....ened on the ground that the petitioner had paid interest to non-residents out of the boundaries of India, therefore, it was required to deduct tax as per the provisions of section 40(a)(i) read with Chapter XVII-B of the Act failing which the interest could not be allowed as a deduction in computation of income chargeable under the head "Profits and gains of business or profession". The Assessing ....

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....aw materials or components or capital plant and machinery, to the extent to which such interest does not exceed the amount of interest calculated at the rate approved by the Central Government in this behalf, having regard to the terms of the loan or debt and its repayments shall not be included in computing the total income of the previous year of any person. It was submitted that the Taxation La....

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....This court has also heard Mr. B. B. Naik, learned senior advocate appearing on behalf of the respondent.   6. From the facts noted hereinabove, it is apparent that the assessment of the petitioner for the assessment year 1994-95 is sought to be reopened by issuing the impugned notice on the ground that the petitioner had paid usance interest amounting to Rs. 14,32,469 on purchase of ships ....