Full Judgment Text
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CASE NO.:
Appeal (civil) 2594 of 2006
PETITIONER:
Commissioner of Income Tax,Baroda
RESPONDENT:
Ishwar Bhuvan Hotels Ltd. Baroda
DATE OF JUDGMENT: 08/02/2008
BENCH:
S.H. Kapadia & B. Sudershan Reddy
JUDGMENT:
J U D G M E N T
CIVIL APPEAL NO.2594 OF 2006
KAPADIA, J.
In this civil appeal filed by the Department the question
of law arises for determination which question is as follows:
"Whether interest paid in respect of borrowings on
capital assets not put to use in the concerned
financial year can be permitted as allowable
deduction under Section 36(1)(iii) of the Income-tax
Act, 1961?"
2. Our answer to the above-mentioned question is squarely
covered by our decision in favour of the assessee and against
the Department in the case of Dy. Commr. of Income Tax,
Ahmedabad v. M/s. Core Health Care Ltd. in Civil Appeal
Nos.3952-55 of 2002.
3. Accordingly the above question is answered in favour of
assessee and against the Department. Consequently the
Department’s civil appeal is dismissed with no order as to
cost.