9911796707
TMI Blog1998 (7) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... -tax Act, 1961 (for short "the Act"), at the instance of the assessee, the Income-tax Appellate Tribunal (the "Tribunal"), has referred the following question of law to this court for opinion : "Whether, on the facts and in the circumstances of the case, the assessee is entitled to deduction of interest of Rs. 76,182 for the assessment year 1977-78, Rs. 95,762 for the assessment year 1978-79 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e computation of his income under section 80V of the Act. This claim of the assessee was rejected by the Income-tax Officer on the ground that the claim of the assessee for deduction of interest on such loan was not permissible under section 80V of the Act because the interest claimed by the assessee was not interest paid on moneys borrowed by the assessee for payment of any tax due under the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide for deduction of interest on any money borrowed for payment of any tax under the Act. It reads : "80V. Deduction of interest on moneys borrowed to pay taxes.---In computing the total income of an assessee, there shall be allowed by way of deduction any interest paid by him in the previous year on any money borrowed for the payment of any tax due from him under this Act." It was deleted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 70 by way of interest-free loan for payment of income-tax. No interest was payable on the money so borrowed by the assessee for payment of income-tax. The loan obtained by the assessee during the previous year relevant to the assessment year 1976-77 was for the purpose of repaying the loans obtained earlier. The assessee claims deduction of the interest paid on such loans under section 80V of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ney borrowed in the previous year, relevant to the assessment year 1976-77 for repayment of the old interest-free loans on the ground that those loans had been taken by him for payment of income-tax. Such interest does not fall within the purview of section 80V of the Act. Obviously, the borrowing, on which interest has been paid, was not for payment of any tax under this Act but for repayment of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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