1987 (7) TMI 50

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....r Bench, Jaipur, has referred the following question of law to this court for adjudication : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that relief under section 80J of the Income-tax Act, 1961, is allowable to the assessee on borrowed capital ? " The assessee, M/s. Lodha Enterprises, jodhpur, is a duly registered partnership fir....

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....ribunal. The appeal was dismissed and the view taken by the Income-tax Commissioner (Appeals) was upheld. The Commissioner of Income-tax thereafter moved an application to the Tribunal to make the reference. The Tribunal thereafter has made this reference. We have heard Mr. B. R. Arora, for the Revenue, and Mr. Rajesh Balia, for the assessee. It was argued by Mr. Arora, learned counsel for t....

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.... expressed by the Madhya Pradesh High Court in CIT v. Anand Bahri Steel and Wire Products [1982] 133 ITR 365 and CIT v. K. N. Oil Industries [1982] 134 ITR 651 was approved by their Lordships of the. Supreme Court in the case of Lohia Machines Ltd. [1985] 152 ITR 308. It would be useful to reproduce the following passage of the judgment rendered in the case of Lohia Machines Ltd. (headnote) : "....

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....ion 80J, by incorporating the provisions of rule 19A, as sub-section (1A) in section 80J, with retrospective effect from April 1, 1972, was merely clarificatory in nature and was, accordingly, valid." The Income-tax Appellate Tribunal was thus not justified and correct in holding that deduction under section 80J of the Income-tax Act, 1961, is allowable to the assessee on the entire amount clai....