1998 (3) TMI 106

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ion under section 256(2) of the Income-tax Act, 1961, the Tribunal has referred the following, question along with the statement of the case for our opinion : "Whether the Tribunal misdirected itself in law in admitting that the unpaid sale price could be treated as borrowed capital within the meaning of clause (vi) of sub-section (1) section 24 of the Income-tax Act, and in that view whether t....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... from Badridas Keshav Prosad, which had been utilised to pay the mortgagee together with interest thereon to the vendor company. In appeal before the Tribunal, the Tribunal has taken a view that the assessee is entitled to deduction of interest paid to Badridas Keshav Prosad on Rs. 3,50,000 borrowed for purchasing house and he is also entitled to deduction of all interest paid to the vendor on ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... assessee to the vendor in yearly instalments of Rs. 1 lakh each with interest at 8 per cent. per annum. Thereafter, the assessee further borrowed the amount from Badridas Keshav Prosad for payment of the unpaid price of the house and also interest due thereon. The Income-tax Officer did not allow any interest on the subsequent borrowed money. However, the Tribunal has allowed the interest on the ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

...., the interest payable on that borrowed capital is deductible from the income of the house property. When the facts are not in dispute that the total cost of the house was Rs. 11,50,000 and Rs. 3,50,000 was paid after borrowing the said amount from Badridas Keshav Prosad the interest on that borrowed capital has been allowed. Subsequently, the assessee has further borrowed an amount for payment of....