Andhra Pradesh H.C : Whether, on the facts and in the circumstances of the case, the Tribunal is correct in law in holding that the amounts of Rs. 360, Rs. 79,100, Rs. 18,909 and Rs. 1,506 and Rs. 17,301 earned by the assessee constitute capital receipts in the assessee’s hands and cannot be bought to tax under the head ‘Other sources’ for the asst. yr. 1981-82 ?

Counsel Appeared

S.R. Ashok, for the Revenue : S. Ravi, for the Assessee

JUDGMENT

Syed Shah Mohammed Quadri, J. :

This application is filed under s. 256(2) of the IT Act, 1961. The Revenue seeks a direction to the Tribunal to refer the following question to this Court for opinion, which is said to have arisen from the order of the Tribunal dt.10th July, 1990, in R.A. No. 14/Hyd/1986 :

“Whether, on the facts and in the circumstances of the case, the Tribunal is correct in law in holding that the amounts of Rs. 360, Rs. 79,100, Rs. 18,909 and Rs. 1,506 and Rs. 17,301 earned by the assessee constitute capital receipts in the assessee’s hands and cannot be bought to tax under the head ‘Other sources’ for the asst. yr. 1981-82 ?”

The amounts referred to in the question represent interest on borrowed capital. The Tribunal took the view that those amounts are capital receipts and cannot be added to the interest. This question is covered by a judgment of the Division Bench of this Court in CIT vs. Nagarjuna Steels Ltd. (1988) 71 CTR (AP) 118 : (1988) 171 ITR 663 (AP) : TC 41R.551 which is against the Revenue and in favour of the assessee. We, therefore, see no reason to direct the Tribunal to refer the said question ITC is, therefore, dismissed.

[Citation : 239 ITR 596]