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TMI Blog2002 (2) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... e case, the Tribunal is right in law in holding that charging of interest under section 216 of the Income-tax Act, 1961, was not justified?" - - - - - Dated:- 6-2-2002 - Judge(s) : R. K. ABICHANDANI., K. A. PUJ. JUDGMENT The judgment of the court was delivered by K.A. Puj J. -The Income-tax Appellate Tribunal, Ahmedabad Bench "A", Ahmedabad, has referred the following questions for the opinion of this court: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the amount of Rs. 50,345 paid as guarantee commission was on capital account and disallowable as such? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the Supreme Court in the above referred cases as well as having regard to the view taken by this court in the later decision of Ambica Mills Ltd.'s case [1999] 235 ITR 264, the reliance placed by the Tribunal on the decision of CIT v. Vallabh Glass Works Ltd. [1982] 137 ITR 389 (Guj) is not held to be justified. We, therefore, reverse the decision of the Tribunal on this point and hold that the expenditure of Rs. 50,345 incurred on account of guarantee commission is revenue expenditure. We, accordingly, answer question No. 1 in the negative, in favour of the assessee and against the Revenue. As far as question No. 2 is concerned, the Tribunal has relied on the decision in the assessee's own case for the assessment year 1977-78 and d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justified in confirming levy of interest under section 215 of the Act. We, accordingly, answer this question in the affirmative in favour of the Revenue and against the assessee. This brings us to the question referred at the instance of the Revenue. The issue is with regard to the chargeability of interest under section 216 of the Act. The Income-tax Officer had not given any reason whatsoever for levy of interest under section 216 of the Act, nor had he recorded the requisite finding as contemplated by clause (a) of section 216 of the Act. A similar issue came up before this court in Shree Digvijay Woollen Mills Ltd. v. CIT [1993] 204 ITR 398, wherein, after considering the relevant case law on the subject, this court has held: ".... ..... X X X X Extracts X X X X X X X X Extracts X X X X
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