IN THE HIGH COURT OF DELHI AT NEW DELHI 
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         ITA 1274/2006  
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 COMMISSIONER OF INTREST TAX         ..... Appellant 
 Through       Ms. P.L. Bansal, Advocate. 
 versus 
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 M/S G.E.CAPITAL TRANSPORTATION       ..... Respondent 
 Through       Mr. M. S. Syali, Sr. Adv. with 
 Mr.Saubhagya Aggarwal and 
 Ms. Mahua C. Kalra, Advocates. 
 . 
 CORAM: 
 HON'BLE MR. JUSTICE MADAN B. LOKUR 
 HON'BLE MR. JUSTICE V. B. GUPTA 
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 O R D E R 
                            28.03.2007 
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 Admit. 
 The Revenue has raised two issues in this appeal. 
 In so far as the first issue is concerned, it is common ground that a 
 substantial question of law does arise.  Therefore, we frame the following 
 substantial question of law:- 
 ?Whether the Income Tax Appellate Tribunal was correct 
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 ITA 1274/2006                                          Page 1 of 3 
 in law in holding that only the net discounting income and 
 not the gross discounting income on Promissory Notes and Bills of Exchange is 
 chargeable to interest tax under the provisions of the Interest Tax Act, 1974?? 
 In so far as the second issue is concerned, we find that the transaction 
 is substantially similar to the transaction that was considered in Commissioner 
 of Interest Tax Vs. M/s. G.E. Capital Transportation, ITA No. 1275/2006 
 dismissed on 1st September, 2006.  The only difference is that in the decided 
 ITA the transaction was a leasing transaction while in the present case the 
 transaction is a hire purchase agreement. 
 Since a hire-purchase agreement is not in the nature of a financing 
 agreement, any interest that the Assessee receives on delayed payment of 
 installments also cannot be said to be interest received on loans or advances 
 made by the Assessee to its customers. 
 Consequently, the second issue urged by learned counsel for the Revenue 
 to the effect that interest received on delayed payment of installments  made 
 by  the  customers  of  the  Assessee  is  chargeable   to 
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 interest tax does not raise any substantial question of law. 
 To this extent, the appeal is dismissed. 
 The Revenue will file the paper books in accordance with the High Court 
 rules in respect of the question earlier framed. 
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 . 
 MADAN B. LOKUR, J 
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 V. B. GUPTA, J 
 MARCH 28, 2007 
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 ITA 1274/2006                                          Page 3 of 3 
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