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Issues:
1. Interpretation of section 40A(2)(a) of the Income-tax Act, 1961 regarding disallowance of rent payments. 2. Allowability of deduction on account of rent for a period beyond March 31, 1974. 3. Determination of allowable deduction for rent payments. Detailed Analysis: Issue 1: The Tribunal disallowed part of the rent payments under section 40A(2)(a) despite finding the reasonable rent to be Rs. 4,000 per month. The court declined to answer this question, citing it as a question of fact based on the Supreme Court's ruling that determining excessive or unreasonable rent is a factual matter, not a legal one. Issue 2: The Revenue contested the deduction of rent for the period from August 11, 1972, to March 31, 1974, against the income chargeable for the assessment year 1974-75. The Tribunal allowed the deduction for this period, but the court held that this question did not arise out of the Tribunal's order as it was not raised or considered by the Tribunal, thus declining to answer it. Issue 3: The Tribunal's observation that the benefit from the rent would be restricted after December 31, 1974, was challenged by the assessee. The court found that the Tribunal erred in considering the liabilities or losses incurred after March 31, 1974, as the assessment was only concerned with the profits and gains for the assessment year 1974-75. Therefore, the court answered this question in favor of the assessee and declined to answer the other questions. In conclusion, the court answered Issue 2 in favor of the assessee and declined to answer Issues 1 and 3. The judgment was forwarded to the Income-tax Appellate Tribunal, Cochin Bench for further action.
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