- (1.) The Income-tax Appellate Tribunal, Allahabad, has referred the following questions of law under Section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), for opinion of this court : 1. Whether, on the facts and in the circumstances of the case, the learned Tribunal was, in law, justified in holding that the claim of investment allowance is allowable ?
(2.) Whether, on the facts and in the circumstances of the case and material available on record, the Income-tax Appellate Tribunal was justified in law, in deleting the addition made being payment of interest exceeding 15 per cent, on the deposits ? 2. The present reference relates to the assessment year 1983-84.
(3.) Briefly stated the facts giving rise to the present reference are as follows : The respondent-company is engaged in the business of construction of tunnels, bridges, roads, etc. It claimed investment allowance under Section 32A of the Act. It had also paid interest amounting to Rs. 59,622 and Rs. 63,943 for the assessment years 1982-83 and 1983-84, respectively, which was more than 15 per cent. The Assessing Officer in the course of the assessment proceedings disallowed the investment allowance as also the amount of interest paid in excess over 15 per cent, on the ground that it is against the provisions of the Companies (Acceptance of Deposits) Rules. Feeling aggrieved the respondent preferred an appeal before the Commissioner of Income-tax (Appeals) who had allowed the claim of investment allowance as also the entire amount of interest paid by the respondent on the deposits. While doing so the Commissioner of Income-tax (Appeals) has relied upon a decision of the Tribunal of the Delhi Bench in the case of CIT v. Hydel Construction Company. He further found that the provisions of the Companies (Acceptance of Deposits) Rules do not apply to deposits, which are neither renewed nor freshly accepted during the relevant period. The order of the Commissioner of Income-tax (Appeals) has been upheld by the Tribunal.;