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TMI Blog2015 (2) TMI 809X X X X Extracts X X X X X X X X Extracts X X X X ..... st by taking into account, the claim made by the respondent for the assessment year 1982-83 and the fact that the cost of construction incurred by it be treated as revenue expenditure was accepted. Beyond that, no discussion whatever was undertaken. Things would have been different in case the Commissioner has undertaken any discussion with reference to the relevant provisions of law and the facts pleaded by the parties. The purport of Explanation 1 to section 36 of the Act was not discussed at all. It was obligatory on the part of the Commissioner, or for that matter, the Tribunal, to examine whether the building in question was owned by the respondent or was taken on lease and whether the construction undertaken by it was permanent or se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the Commissioner of Income-tax (Appeals)-I, Hyderabad (for short the Commissioner ). The appeals were allowed through order dated March 3, 1994. Aggrieved by that, the Revenue filed two appeals, i.e., I. T. A. Nos. 1303/Hyd/1994 and 1304/Hyd/ 1994 before the Tribunal. Both the appeals were dismissed through common order dated December 20, 2000. In I. T. T.A. No. 87 of 2001, only one substantial question of law is framed, namely : Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is justified in upholding the deletion of disallowance on account of interest payments in spite of the clinching material establishing diversion of the borrowed funds for unfruitful and non- commercial pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts that the record discloses that the order dated December 2, 1993, passed by the Commissioner was the subject matter of I. T. A. No. 811/Hyd/1994 and that the appeal has been allowed through order dated March 2, 2000. He further submits that the view taken by the Commissioner about the deduction of interest paid on loans cannot be sustained in law since the assessee failed to establish that the amount was used for the business or profession. It is also urged that the Tribunal erred in treating the order passed by the Commissioner for the assessment year 1982-83 in relation to a construction, as constituting the basis for treating the amount of ₹ 3,00,000 as revenue expenditure. According to him, this runs contrary to Explanation 1 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the profession. The Appellate Commissioner, however, has reversed that finding. In the further appeal preferred by the Revenue, the only factor that weighed with the Tribunal was that an order pertaining to the assessment year 1988-89 passed by the Commissioner may have become final. Even this opinion was not formed after a thorough verification of the records. It was almost on the assumptions. The relevant portion reads as under : Both parties have not pointed out at the time of hearing that the Revenue has filed any appeal against the order of the Commissioner of Income-tax (Appeals) for the assessment year 1989-90 (there appears to be typographical mistake in this behalf and the correct assessment year is 1988-89), dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated it as revenue expenditure. The purport of Explanation 1 to section 36 of the Act was not discussed at all. It was obligatory on the part of the Commissioner, or for that matter, the Tribunal, to examine whether the building in question was owned by the respondent or was taken on lease and whether the construction undertaken by it was permanent or semi- permanent in nature. We feel that even this question needs to be addressed by the Tribunal, in detail. Hence, we allow the appeals and remand the matters to the Tribunal for fresh consideration and disposal after giving opportunity to both the parties. There shall be no order as to costs. The miscellaneous petitions in these appeals shall also stand disposed of. - - TaxTMI - TM ..... X X X X Extracts X X X X X X X X Extracts X X X X
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