TaxTMI 
TaxTMI 
2008 (2) TMI 190
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....whereby he had directed the Assessing officer to disallow interest of Rs.2,63,658/- payable on excise refund ?" 2. The Assessment Year is 1986-87. Assessment for the assessment year in question came to be framed vide assessment order dated 31.03.1989. The Commissioner of Income-tax, Baroda (the CIT) issued show cause notice under Section 263 of the Act on the following ground: "The interest payable on excise refund amount to Rs.2,63,658/- has been claimed and allowed as a deductible item, the same being a statutory liability needs to be disallowed u/s. 43-B." 3. After considering the submissions of the assessee the CIT came to the conclusion that the amount of Rs.2,63,658/- should not have been allowed as a deduction while computing the ....
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....63 of the Act. In support of the submissions made reliance has been placed on decision of this Court in the case of Commissioner of Income-tax Vs. Express Hotel P. Ltd., [2006] 281 ITR 160 (Guj.). 6. As against that Mr. M .J. Shah, learned advocate for the respondent assessee, while supporting the order of the Tribunal, has sought to derive support from the Apex Court decision in the case of Commissioner of Income-tax & Anr. Vs. Distiliers Co. Ltd., [2007] 290 ITR 419 (SC). It was submitted that the Tribunal had rightly appreciated the fact that the assessee was required to pay interest, not because of any statutory provision but because of an order made by the High Court in related proceedings, in context of the claim of the assessee for....
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....ide order dated 06.04.1984 the High Court directed the assessee to refund the Excise Duty withdrawn with 12% interest on the said amount. 8. The assessee carried the matter in appeal before Supreme Court of India by way of a Special Leave Petition to Appeal. While granting Special Leave to Appeal Supreme Court stayed the recovery of Excise Duty withdrawn by the assessee, subject to the assessee filing an undertaking that in the event of the assessee losing in the appeal, the assessee will have to refund the amount to the Central Government, together with interest @ 12% p.a., and that the Bank Guarantee furnished by the assessee for the full amount shall continue till decision of the appeal. It is this amount of Rs.2,63,658/- which has been....