ORDER A. R. TIWARI, J. : In compliance of the directions dt. 22nd Sept., 1988 issued by this Court in Misc. Civil Case No. 141 of 1986, the Tribunal stated the case and referred the under noted question of law arising out of the order dt. 27th June, 1985 passed by the Tribunal in ITA Nos. 53 to 55/Ind/1984 for asst. yrs. 1980-81 to 1983-84 connectible with applications registered as RA Nos. 86 to 89/Ind/85, for our opinion : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the sums received from the directors and shareholders of the assessee did not amount to deposits within the meaning of s. 40A(8) of the Act and that no disallowance of interest under s. 40A(8) of the Act was called for?" 2. Facts lie in a narrow compass. The assessee is a private limited company known as M/s Kalani Asbestos Cement Private Limited, Indore. During the course of assessment, the ITO noticed that for each of the assessment years under appeal the assessee had claimed various amounts of interest paid. The ITO was of the opinion that the amounts on which interest was paid were received by the assessee by way of deposits. As such, in terms of s. 40A(8) of the IT Act, 1961 (for short the Act), 15% of the interest paid to such persons was disallowable. Accordingly the ITO made the disallowance for each of the four assessment years quantified at Rs. 51,600. The assessee felt aggrieved by the order of disallowances (Annexures A, A/1, A/2 and A/3) and filed appeals before the CIT(A) on contention that the interest paid to directors and shareholders was on their current accounts and, therefore, no disallowance was called for. The CIT(A) reduced the quantum of liability with reference to certain parties, as particularised in the Statement of the Case (Annexures-B, B/1, B/2 and B/3). The assessee still felt dissatisfied and filed the appeals before the Tribunal which were registered as 52 to 55/Ind/84. The Tribunal took into consideration the position of deposits under the Companies Act, 1956, the Press-note issued by the Ministry of Law, Justice & Company Affairs and the provisions of law and accepted the claim of the assessee that such monies were kept with the company by the directors and shareholders and were in the nature of running current accounts (Annexure-C). The Department felt dissatisfied by the order passed by the Tribunal and presented applications under s. 256(1) of the Act which were registered as RA Nos. 86 to 88/Ind/85. These applications were rejected by the Tribunal on 6th Dec., 1965 (Annexure-D). The Department then filed application before this Court under s. 256(2) of the Act which was registered as Misc. Civil Case No. 141 of 1986. This Court directed the Tribunal on 22nd Sept., 1988 to state the case and refer the question as proposed in the aforesaid case. The Tribunal has stated the case and referred the aforesaid question. 3. We have heard Shri D. D. Vyas, learned counsel for the applicant/Department and Shri S. C. Bagdiya, learned counsel for the non-applicant/assessee. 4. Earlier the Tribunal had declined to state the case on conclusion that the finding of the Tribunal was based on appreciation of the facts and on reliance on circular and the provisions of law. Sec. 40A(8) now stands omitted by the Finance Act, 1985 w.e.f. 1st April, 1986. Earlier this provision was inserted by the Finance Act, 1975 w.e.f. 1st April, 1976. According to this provision as it was in force at the relevant time, it was provided that if the assessee, being a company, incurs any expenditure by way of interest in respect of any deposit received by it, fifteen per cent of such expenditure shall not be allowed as a deduction. The contest between the parties i.e. the assessee and Department was as to whether the accounts standing in the name of the directors and shareholders were in the nature of current accounts or were in the nature of deposits as envisaged by s. 40A(8) as was in force at the relevant time. On appreciation of the facts, the Tribunal found that the same were in the nature of current accounts and not in the nature of deposits and as such there was no question of invoking s. 40A(8) of the Act. 5. Finding reached on appreciation of facts does not give rise to any question of law. In CIT vs. Ashoka Marketing Ltd. : (1976) 103 ITR 543 (SC) and in CIT vs. Kotrika Venkataswamy & Sons (1971) 79 ITR 499 (SC) it is held that conclusion based on question of fact does not give rise to any question of law. 5. Finding reached on appreciation of facts does not give rise to any question of law. In CIT vs. Ashoka Marketing Ltd. : (1976) 103 ITR 543 (SC) and in CIT vs. Kotrika Venkataswamy & Sons (1971) 79 ITR 499 (SC) it is held that conclusion based on question of fact does not give rise to any question of law. However, as the question is submitted in compliance of the directions issued by this Court, we heard the parties at length. The counsel for the applicant was unable to show to us as to how the sums received from the directors and shareholders of the assessee amount to deposits within the meaning of s. 40A(8) of the Act. This provision has now been omitted w.e.f. 1st April, 1986. 6. This aspect was earlier considered by the Union of India. The press note took into account s. 58A of the Companies Act, 1956 and the Press-note issued on that linchpin by the Ministry of Law, Justice & Company Affairs indicated that the amount received from the directors and shareholders of a private limited company did not represent deposits but such amounts were kept with the company only in the nature of running current accounts allowing the directors and shareholders to withdraw the same as and when required. 7. In view of the provisions of the Companies Act, Press-note, nature of the accounts, position of the deposits, we are satisfied that the Tribunal committed no error in holding that the such amounts were in the nature of running current accounts and not in the nature of deposit so as to attract erstwhile provision under s. 40A(8) of the Act. 8. On consideration, we, therefore, answer the question in the affirmative i.e. in favour of the assessee and against the Department. 9. This case is thus decided in terms indicated above but with no order as to costs. 10. Counsel fee for each side is allowed at Rs. 750, if certified.