NASIM SIKANDAR, J.---This order will dispose of I.T.As. Nos.134, 135 and 136 of 1998.
2. In these Income Tax Appeals under section 136 (since amended) of the Income Tax Ordinance, 1979, the Commissioner of Income Tax Companies Zone-III, Lahore claims that following common question of law has arisen out of a consolidated order, dated 17-1-1992 recorded by the Lahore Bench of the Income-tax Appellate Tribunal:-- "Whether on the facts and circumstances of the case the learned I.T.A.T. Was justified in allowing financial expenses incurred on the loan obtained and invested in the shares of another company, where-from no dividend income was accrued/paid to the assessee."
3. The assessee-respondent is a public limited company and derives income from a spinning mill.
For the three assessm ent years involved viz. 1992-93 to 1994-95; while framing the assessments, the Assessing Officer disallowed interest on the amounts borrowed which were statedly invested in purchase of shares of associated companies.
4. On appeal the learned first appellate authority deleted the addition so made out of financial expenses. On further appeal, the learned Members of the Tribunal by way of the impugned order, dated 17-1-1998 refused to interfere for the department.
5. After hearing the learned counsel for the parties, we are of the view that the question as framed does not arise out of the order of the Tribunal. It has been noted that no borrowing was actually made for the purpose of making advances to the sister concerns or to purchase their shares.
Instead it was claimed that the entire bank borrowing was utilized for the purchase of raw material and against their pledged/hypothecation. A month-wise details was provided to the learned first appellate authority and was reproduced by it in the order. These details indicate that bank borrowing were invariably less than the position of value of stock during the period relevant to the assessm ent year under in question. While deleting the addition so made, it is correct that the first authority did make some mention of the alternate argument of the assesseecompany but the fact remains that the learned first appellate authority ultimately agreed that no borrowing was made either for advancing funds to associated companies or for investment in their shares. The learned Tribunal maintained the finding so recorded by the learned first appellate authority.
6. Also a glance on the aforesaid question makes it clear that it is more in nature of an argument pre-supposing a finding of fact, at least, by the Tribunal that financial expenses were incurred on the loans obtained and invested in the shares of other companies wherefrom no A dividend income accrued to the assessee. That finding of fact is absent in the order of the learned Tribunal, and therefore, as said above, the question as framed cannot be said to have arisen out of the order of the Tribunal. It needs to be emphasized that only a question of law arising out of the order of the Tribunal can be a subject of appeal under the B amended provisions of section 136 of the Income Tax Ordinance, 1979. It is also an established law that this Court while considering a question C of law arising out of the order of the Tribunal considers the facts as these were found by the Tribunal. The Tribunal as noted earlier, never found as fact that the amounts borrowed by the company were used for the purpose of indicated in the aforesaid question.
7. Therefore, we will refuse to entertain the same for our consideration and reply.
Dismissed in limine. .