EICHER GOODEARTH LTD. Vs. THE CIT

JUDGEMENT

(1.) The questions of law as framed originally were as follows: -

(2.) In view of the developments which have occurred during the pendency of the appeal, i.e., the order passed by the Assessing Officer for AY 1993-94 and 1994-95 where the assessee's contentions have been dealt with and accepted in part so far as the administrative expenditure is concerned and in view of the order that we propose, the detailed factual narrative is inessential.

(3.) The assessee is aggrieved by the decision of the Income Tax Appellate Tribunal ("ITAT") which held that the interest expenditure incurred by it whilst repaying the loan (of '6.5 Crores) borrowed for the purpose of subscribing all the rights issue of Eicher Tractors Ltd. during AY 1994-95 (year ending 31.3.1994) had to be dealt with and allowed if at all under Section 57 of the Income Tax Act, 1961. In doing so, the ITAT rejected the assessee's contention that such interest by itself amounted to business expenditure and was properly admissible under Section 36 (1) (iii) of the Income Tax Act, 1961.