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1 - 9 of 9 (0.32 seconds)State Bank Of Mysore vs Commissioner Of Income-Tax on 15 June, 1988
6.1 The learned DR has placed reliance on the decision of the Karnataka High Court in the case of State Bank of Mysore v. CIT ' wherein it was held that discount on bills is a form of advance or loan granted to its customer by a bank and therefore, any amount collected by bank for delayed payment of that amount would be interest, whatever may be the nomenclature and be chargeable interest under Section 2(7) of Interest-tax Act.
Commissioner Of Income Tax, ... vs Karnataka State Cooperative Apex Bank on 22 August, 2001
The Madhya Pradesh High Court in the case of State Bank of Indore (supra), was in seisin of a situation where the assessee claimed that the damages received for delayed payment was in the nature of compensation for the damages and was not interest on loans and advances and thus not exigible to interest, tax under the Interest-tax Act. The court held that the right to charge the amount for delay in the payment of bills accrued to the assessee by virtue of the provisions of Section 32 of the Negotiable Instruments Act, 1881 and in accordance with the terms of the agreement entered into by the assessee with its constituents in pursuance of which bills were purchased by the assessee. On account of the delayed payments of the bills purchased by the assessee, the assessee became entitled to liquidated damages by way of compensation as stipulated in the agreement. The right of the assessee to charge the amount did not, therefore, arise on account of any delay for repayment on any loans or advances made by the assessee. The provisions of Interest-tax Act were attracted only in respect of interest on loans and advances and therefore the amount charged by the assessee for delayed payment of the bills could not be held to be "interest on loans and advances" and is not exigible to tax under the Interest-tax Act.
Central Bank Of India vs The Jt. Commissioner Of Income Tax, Spl. ... on 19 September, 2005
6. The' J' Bench of this Tribunal in the case of Central Bank of India (supra) had an occasion to consider whether the service charges received by a bank from its credit cardholders ort overdue payments can be considered as interest on loans and advances liable to interest tax, and it was held that the said charges are not exigible to interest tax.
P.Kasilingam & Ors vs P.S.G. College Of Technology & Ors on 24 March, 1995
This definition has been extensively considered and analysed threadbare by the 'A' Bench of this Tribunal in the case of LIC of lndia v. Jt. CIT (2002) 82 ITD 749. In the said case the Tribunal was dealing with the issue as to whether Government of India securities, debentures and bonds are loans and advances and the interest therefrom is exigible to interest tax. After considering the issue at length, it was held that only the interest on loans and advances made with the sole purpose of financing the borrower is to be taxed. After considering the decisions of the Apex court in the cases bf Mahalakshmi OU Mills v. State of AP and P. Kasilingam v. P.S.G. College of Technology on the expressions "means and includes" and "means" used in the definition clauses, and after considering the definition of the term "interest", it was held that when only the term 'means' is used, it gives a hard and fast definition whereas when only 'includes" is used, it enlarges the meaning of the expression defined so as to comprehend not only such things as they signif y according to their natural import but also those things which the clause declares that they shall include. On the other hand, when the term "means and includes" is used, it indicates an exhaustive explanation of the meaning. Thus, it was observed that there may be some other items also which, though strictly, may not be interest, but may be having some characteristics of interest and considering the meaning of the expression "means and includes" as explained in the above two decisions of the Supreme Court, no more items can be included in the definition except the two specifically included by the Legislature.
Section 32 in The Negotiable Instruments Act, 1881 [Entire Act]
The Life Insurance Corporation Of ... vs Commissioner Of Income Tax, Tamil Nadu ... on 12 April, 2000
This decision has already been considered by the Tribunal in the case of LIC of India (supra).
The Income Tax Act, 1961
The Dy. Commissioner Of Income-Tax vs State Bank Of Travancore on 21 July, 2006
This very same view was also expressed by the Kerala High Court in the case of State Bank of Travancore (supra), wherein it was held that the character of an overdue bills is wholly distinct from loans and advances, and the interest on the loans and advances alone is taxable under the Interest-tax Act. The character of an overdue bill is not synonymous with loans and advances. Therefore the interest on the overdue bills is to be excluded from chargeable interest under the Income Tax Act, 1974.
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