CIT Vs. NARANG INDUSTRIES PVT LTD.

JUDGEMENT

(1.) This appeal by the Revenue under Sec. 260A of the Income Tax Act, 1961 (Act, for short) is directed against the order of the Income Tax Appellate Tribunal (for short, the tribunal) in the case of M/s Narang Industries Private Ltd. The appeal pertains to the assessment year 2003 -04.

(2.) Several issues have been decided by the tribunal in the impugned order dated 8th April, 2011. The Revenue has preferred the present appeal only in respect of one ground i.e., the addition of Rs. 1,59,28,955/ - made by the Assessing Officer on account of interest and financial charges. The contention of the Revenue is that the interest paid should be disallowed under Sec. 36(1)(iii) of the Act. The said provision reads as under:

(3.) The Assessing Officer while making the aforesaid addition has given the following reasoning: