1989 (7) TMI 21

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..... for the decision of this court : "1. Whether, on the facts and in the circumstances of the case, the assessee is entitled to claim deduction of the interest paid ? 2. Whether, on the facts and in the circumstances of the case, the assessee is entitled to claim deduction of interest paid for non-payment of 'kist' after the 20th of the month ?" The respondent is an assessee to income-tax. We .....

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..... yment of contractual dues and so not penal or punitive in character. In this view, the deduction allowed by the Commissioner of Income-tax (Appeals) was sustained. Thereafter, at the instance of the Revenue, the Income-tax Appellate Tribunal has referred the above-formulated questions of law for the decision of this court. We heard counsel. Counsel for the Revenue argued that payment of interest .....

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..... favour of the assessee. There is no dichotomy in the interest paid whether it is before the 20th or after the 20th of the month. The, obligation to pay interest was under contract. On this basis, we have only to hold that the claim for interest is permissible deduction. It does not appear that the Revenue produced any material to show that the non-payment of kist was after the 20th of the month .....

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