TaxTMI 
TaxTMI 
1977 (1) TMI 28
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....come-tax Appellate Tribunal, Gauhati Bench, under section 256(1) of the Income-tax Act, 1961, hereinafter referred to as "the Act" : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in allowing the interest paid to the State Bank of India, the court expenses and the travelling expenses incurred for acquiring Phookanbari Tea Estate even though the transaction....
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....ltimately set aside. The amount paid by the assessee was accordingly refunded. But the assessee had paid Rs. 10,692 as interest on the loan taken from the State Bank of India. In the assessment order the Income-tax Officer held that this amount of interest paid by the assessee was a capital expenditure and so he disallowed the same. The assessee had also incurred travelling expenses of Rs. 1,000 a....
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....ials on record and rejected the appeal of the department. On the above facts, the abovementioned question of law has been referred. We have perused the order of the Tribunal and the question of law framed. In its order the Tribunal has observed as follows : "During the accounting year, the loan was taken for the purpose of the assessee's business, i.e., acquisition of another tea estate. In the....
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....t is not possible to say that it is a separate business." From the order of the Tribunal it is quite clear that the assessee is a company which carries on business of growing and manufacturing tea. It purchased in auction sale the Phookanbari Tea Estate, apparently to expand its tea business. Though, ultimately, the sale was set aside at the instance of the owners of the Phookanbari Tea Estate, t....