2005 (2) TMI 91

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....tion of law under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), for opinion to this court: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was legally correct in upholding the finding of the Commissioner of Income-tax (Appeals) that disallowance under section 40A(8) of the Income-tax Act, 1961 could be made only....

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....respect of interest paid to the directors and their relation and associates could only be disallowed. No disallowance was called for in respect of payment of interest to outsiders. He found that the interest to two directors and their relation on deposits was Rs. 86,472 and interest paid on the amount taken on the advance in business was Rs. 1,52,218. The Commissioner, therefore, upheld the disall....