2001 (11) TMI 37

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....the Income-tax Act, 1961? 2. Whether, on the facts and in the circumstances of the case and also on an interpretation of the agreement dated September 27, 1983, the Tribunal is right in holding that the assessee would not only forfeit the advances but also stand exposed to civil and criminal action and in that sense allowing the payment of interest as contractual obligation?" I.T.R. No. 310 of 1999 is at the instance of the assessee. The questions referred to us are the following: "1. Whether the Tribunal was right in rectifying the order passed under section 256(1) on the ground that there was a mistake apparent from record? 2. Whether, the Tribunal was right in holding that it has inherent power for rectifying the order under ....

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....d by the vendor in favour of the assessee or the nominee or nominees of the assessee. It is stated that pursuant to this agreement, the assessee took possession of the property and sold to others the building therein for scrap value. Thereafter the assessee took a sale deed in its name in respect of 65.57 cents of land and sale deeds in respect of the balance extent of 400.43 cents were taken in the names of sister concerns of the assessee. The assessee claimed that the assessee had to pay a sum of Rs.4 lakhs as interest to the vendor pursuant to the agreement for sale, and this payment of Rs.4 lakhs was liable to be deducted as business expenditure. The Assessing Officer rejected the claim of the assessee holding that the entire expendi....