DCIT, New Delhi V. M/s. R.B. Narain Singh Sugar Mills Ltd., New Delhi

ITA 1454/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3730 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 03-06-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 05-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H K LAL
• Keywords: Capital receipt

Judgement Text

I.T.A. NO. 1454 /DEL/2010 1/3 IN THE INCOME TAX APPELLATE TRIBUNAL, NEW DELHI, BENCH F BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI A K GARODIA, ACCOUTANT MEMBER ITA NO. 1454 /DEL/2010 (ASSESSMENT YEAR 2006-07) DCIT, CIRCLE 15(1), VS. M/S. R.B. NARAIN SINGH NEW DELHI SUGAR MILLS LTD., FLAT NO.43, B BLOCK, CONNAUGHT PLACE, NEW DELHI-110 001 (APPELLANTS) (RESPONDENTS) PAN / GIR NO.AAACR0924M APPELLANT BY: SHRI H K LAL, SR. DR RESPONDENT BY: SHRI M P RASTOGI, ADV. ORDER PER A. K. GARODIA, AM: 1. THIS APPEAL BY THE REVENUE HAS BEEN PREFERRED AGAIN ST THE ORDER OF LD. CIT(A) XVIII, NEW DELHI DATED 19.01.2010 FOR THE ASSESSMENT YEAR 2006-07. THE ONLY GROUND RAISED BY THE REVENUE IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN DISALLOWANCE OF INTE REST OF RS.55,04,892/- BEING THE INTEREST PAID BY THE ASSESSEE TO THE CENTRAL GOVERNMENT. 2. THE BRIEF FACTS OF THE CASE ARE THAT IT IS NOTED BY THE A.O. IN PARA 5 OF THE ASSESSMENT ORDER THAT THE ASSESSEE HAS DEB ITED AN AMOUNT OF RS.55,04,892/- AS INTEREST PAID ON LOAN F ROM CENTRAL GOVERNMENT IN ITS P & L ACCOUNT. IT IS FURTHER NOT ED BY THE A.O. THAT A CORRESPONDING AMOUNT HAS BEEN SHOWN AS CAPITAL I.T.A. NO. 1454 /DEL/2010 2/3 SUBSIDY IN THE BALANCE SHEET IN SCHEDULE 2 - RESERV ES & SURPLUS. IT IS FURTHER NOTED BY THE A.O. IN THE SA ME PARA THAT IT HAS BEEN SUBMITTED BY THE ASSESSEE BEFORE HIM THAT THE TRIBUNAL IN ITS ORDER FOR ASSESSMENT YEAR 1990-91 HAS HELD T HAT INTEREST IS TO BE ALLOWED AS DEDUCTION AND THE SUBSIDY ON TH IS ACCOUNT IS A CAPITAL RECEIPT. IT IS FURTHER OBSERVED BY THE A .O. THAT AGAINST THIS DECISIONS OF THE TRIBUNAL ON THIS ISSUE FOR AS SESSMENT YEARS 1990-91, 1989-90, 1993-94, 1994-95 AND 1998-9 9, APPEALS WERE MADE BEFORE THE HON'BLE HIGH COURT, WH ICH WERE DISMISSED AND THE DEPARTMENT HAS FILED SPECIAL LEAV E PETITION BEFORE THE HON'BLE SUPREME COURT ON THIS ISSUE. AF TER MAKING THESE OBSERVATIONS AND SOME OTHER OBSERVATIONS, HE TREATED THE SUBSIDY RECEIVED OF RS.55.04 LACS AS REVENUE RECEIP T. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE TRIBUNAL ORDER ON THIS ISSUE IN TH E ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 1990-91. IT IS AL SO NOTED BY THE LD. CIT(A) THAT THE 2 ND APPEAL FILED BY THE REVENUE AGAINST THE TRIBUNAL ORDER HAS BEEN DISMISSED BY THE HON'BL E HIGH COURT OF DELHI BY HOLDING THAT NO SUBSTANTIAL QUEST ION OF LAW ARISES OUT OF THIS ORDER OF THE TRIBUNAL. NOW, THE REVENUE IS IN APPEAL BEFORE US. 3. THE LD. D.R. SUPPORTED THE ASSESSMENT ORDER WHEREAS IT IS SUBMITTED BY THE LD. A.R. THAT FOR ASSESSMENT YEAR 1996-97, SLP FILED BY THE REVENUE BEFORE THE HON'BLE APEX CO URT ON THIS VERY ISSUE HAS BEEN DISMISSED BY THE HONBLE SUPREM E COURT AS PER THE JUDGEMENT DATED 28.08.2008. IT IS SUBMITTE D THAT THE COPY OF THE JUDGMENT OF HONBLE APEX COURT IS AVAIL ABLE ON PAGE 1-3 OF THE PAPER BOOK. IT IS ALSO SUBMITTED T HAT THE COPY OF I.T.A. NO. 1454 /DEL/2010 3/3 THE JUDGEMENTS OF HON'BLE HIGH COURT OF DELHI ON TH IS VERY ISSUE IN THE ASSESSEES OWN CASE FOR THE ASSESSMENT YEARS 1989- 90, 1990-91, 1998-99 ARE AVAILABLE AT PAGES 4-6, 7- 8 AND 9-10 OF THE PAPER BOOK RESPECTIVELY. IT IS ALSO SUBMITTED THAT COPY OF THE TRIBUNAL DECISIONS ON THIS VERY ISSUE IN THE AS SESSEES OWN CASE FOR VARIOUS ASSESSMENT YEARS INCLUDING ASSESSM ENT YEARS 1989-90, 1990-91, 1993-94, 1994-95, 1996-97 AND 199 8-99 ARE ALSO AVAILABLE ON PAGES 11-67 OF THE PAPER BOOK. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, HAVE GONE THROUGH THE MATERIAL AVAILABLE ON RECORD AND ALSO THE ORDER S OF AUTHORITIES BELOW. WE FIND THAT THIS IS ADMITTED P OSITION THAT THIS VERY ISSUE HAS BEEN DECIDED BY THE TRIBUNAL AN D ALSO BY THE HON'BLE HIGH COURT OF DELHI IN FAVOUR OF THE ASSESS EE IN THE ASSESSEES OWN CASE AND HENCE WE FIND NO REASON TO INTERFERE IN THE ORDER OF LD. CIT(A) ON THIS ISSUE BECAUSE THE L D. CIT(A) HAS SIMPLY FOLLOWED THE TRIBUNAL DECISION IN THE AS SESSEES OWN CASE FOR THE ASSESSMENT YEAR 1990-91. WE, THEREFOR E, DECLINE TO INTERFERE IN THE ORDER OF LD. CIT(A). 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISS ED. 6. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT ON 1 8 TH JUNE 2010. SD/- SD./- (RAJPAL YADAV) (A K GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:18 TH JUNE, 2010 SP. COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT TRUE COPY: BY ORDER 4. CIT(A) 5. DR DY. REGISTRAR, ITAT, NEW DELHI