1.5 crores during the relevant previous year was to be allowed as a permissible deduction?
10,000/ on the ground that it related do discount on debentures issued in an earlier year and hence it did number pertain to the relevant previous year.
The assessee then preferred an appeal before the Appellate Tribunal.
The following two questions were referred to the Madras High Court Whether on the facts and in the circumstances of the case, the Tribunal was justified in permitting the assessee to raise the companytention that the entire amount of Rs.
The appellant company actually received Rs.
The total discount on the issue of Rs.
1.5 crores repayable with interest at the rate of 5 3/4 per annum.
100/ was Rs.
Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that the assessee had incurred an expenditure of Rs.
In the relevant accounting year, the assessee who followed the mercantile system of accounting, actually received in cash only a sum of Rs.
On appeal, the Appellate Assistant Commissioner by his order dated July 4, 1969 held that the discount allowed at the time of the issue of debentures was to be treated as a part of the expenditure for such issue.
The assessee companytended.
3,00,000/ relating to the issue of debentures of Rs.
The present appeal is filed by the appellant company against the second question as reframed by the Madras High Court and answered as above.
The Income tax offer by his assessment order dated January 31, 1969 disallowed the claim of the appellant for deduction of Rs.
1.5 crores amounted to Rs.
3,00,000/ on debentures which were issued by the appellant companypany is expenditure incurred by the appellant companypany for the purposes of its business.
1.5 crores during the relevant previous year and the same was allowable as a revenue expenditure?
crores.
The debentures were issued at a discount of 2, redeemable after 12 years.
Before the Tribunal the department companytended that the appellant company had, for the first time, made a new claim before the Tribunal for deduction of Rs.
The Madras High Court by its judgment and order dated November 5, 1987 reported in 1980 124 ITR 454 answered the first question in favour of the appellant assessee.
3,00,000/ during the relevant previous year by was of discount paid to the persons who had subscribed to the debentures issued by it for Rs.
The issue price of a debenture of Rs.
This objection was rejected by the Tribunal.
12,500/ But rejected the claim as regards Rs.
29,392/ towards the sale price of lands but it credited in its accounts the sum of Rs.
For the Rs.
3,00,000/ being the discount relating to the issue of debentures for Rs.
3 lakhs.
43,692/ representing the full sale price of land and at the same time it also debited an estimated sum of Rs.
On the application of the Department, the Tribunal stated as case under Section 256 1 of the Income tax Act, 1961 to be decided by the Madras High Court.
The assessee under took to carry out the development of these plots.
Mrs. Sujata V. Manohar, j. The appellant is public limited companypany.
The present appeal filed by it pertains to the accounting year ending June 30, 1967 relevant to the assessment year 1968 89.
The total value of the debentures was Rs.
On December 10, 1966 a public issue of the debentures of the appellant companypany was made.
