2011 (12) TMI 733

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....09 passed in ITA No. 1507/Mds/10. Since the issues involved in all these appeals are same, we are disposing them off by this consolidated order for the sake of brevity and convenience. 2. In all these M.Ps, the assessee's common submission is as under: "The above petitioner is assessed to tax in PAN AAACC1287E by the Assistant Commissioner of Income Tax, Circle-I, Kumbakonam. The appeal for the above year was preferred by the department and the petitioner is the respondent in the above appeal. The appeal was disposed off by the Tribunal vide consolidated order dated 08.07.2011. Among other issues, the department has agitated the issue of "Interest paid on purchase of securities" and contended that the same is not allowable as re....

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....al passed in the case of the assessee itself. 4. However, now it was pointed out by the assessee that the issue stands decided by the Hon'ble Jurisdictional High Court in the case of CIT Vs. Karur Vysya Bank Ltd in Tax Case Appeal No. 2139 of 2008 order dated 13.7.2009 in favour of the assessee. The Hon'ble High Court has held as under: "4. The next question of law is as to "whether the Tribunal was right in law in holding that the interest paid on charge of investment is allowable as revenue expenditure disregarding the principle that the interest paid on charge of investments categorised as "Permanent" are to be treated as capital expenditure and not as "revenue expenditure". As far this Question of Law is concerned, t....

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....Hon'ble Supreme Court decision reported in 240 ITR 355 has arrived at the conclusion that the interest paid will not be a capital expenditure and only a revenue expenditure. Hence, we hold that the Tribunal's finding is legal, valid and correct. Therefore, this question is also answered against the Revenue and in favour of the assessee following the above decisions of this Court and the Hon'ble Supreme Court." 5. The ld. D.R. Shri K.E.B. Rengarajan could not point out any reason as to why the above decision of the Hon'ble Jurisdictional High Court is not applicable on the facts of the instant case. Further, it is not in dispute that the decisions which are contrary to the decision of the Hon'ble Jurisdictional High Court ....