COMMISSIONER OF INCOME TAX Vs. MOTILAL JAIN

JUDGEMENT

(1.) PURSUANT to a judgment passed by this court under Section 256(2) of the Income-tax Act, 1961 (briefly, "the Act"), the Tribunal referred the following question for our opinion ;

(2.) THE relevant facts as gleaned from the order of the Tribunal relating to the assessment year 1972-73, inter alia, are that the assessee has a one-fourth share in a building, namely, "Agarwal Building", situated at Mall Road, Kanpur. THE assessee claimed deduction of Rs. 13,924 for the assessment year 1972-73 representing the assessee's share of composition money paid to the Cantonment Board. THE plot on which the said building is situate was purchased in the year 1963 by the assessee and others from the original owner. THE original lease deed was of the year 1932 and there was a condition that the construction would be completed within two years. THE original owner got time extended to make construction up to November, 1963. Before the expiry of that period, the assessee applied for further extension and pending these proceedings started construction of the building. Though reply from the Government was awaited, the building was completed. In 1968, certain objections were raised to the construction being made without a valid extension of time and thereafter the assessee and three co-owners paid Rs. 53,179 as compounding fee.

(3.) THE short question for consideration is whether the claim of the assessee was deductible under Section 24(1)(ii) of the Act which when properly read, runs as follows :