ACIT, CHENNAI V. M/s. Shriram Chits Tamil Nadu Pvt. Ltd., CHENNAI

ITA 1615/CHNY/2009

• Counselvise Citation: 161521714 RSA 2009
• Duration Of Justice: 1 year(s) 11 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 06-09-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 15-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR I VIJAYAKUMAR
• Assessee Lawyers: V D GOPAL
• Keywords: Bad and doubtful debts; Commercial expediency

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI [BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER] I.T.A NO. 1615/MDS/2009 (ASSESSMENT YEAR : 2005-06 ) THE ACIT COMPANY CIRCLE VI(2) CHENNAI VS M/S SHRIRAM CHITS TAMIL NADU PVT. LTD GREAMS DUGAR, 4 TH & 5 TH FLOOR NO.149, GREAMS ROAD CHENNAI 600 006 [PAN AABCS0167N ] (APPELLANT) (RESPONDENT) APPELLANT BY : DR.I.VIJAYAKUMAR, CIT/DR RESPONDENT BY : SHRI V.D.GOPAL, ADVOCATE DATE OF HEARING : 06-09-2011 DATE OF PRONOUNCEMENT : 10-10-2011 O R D E R PER HARI OM MARATHA, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE, FOR ASSESSMENT YE AR 2005-06, IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A), DATED 19.12.2008. FOLLOWING GROUNDS HAVE BEEN RAISED BY THE REVENUE: 1. THE ORDER OF THE LEARNED CIT (A) IS CONTRARY T O LAW AND FACTS OF THE CASE. 2.1 THE LEARNED CIT (A) ERRED IN HOLDING THAT THE ASSESSING OFFICERS ACTION IN DISALLOWING CLAIM OF BAD ITA 1615/09 :- 2 -: DEBT RELATING TO DEFAULTING PRIZED SUBSCRIBERS WAS NOT CORRECT, REPLYING UPON THE HON'BLE ITATS ORDER IN I.T.A.NO. 1632/MDS/2003 DATED 28.9.2006 FOR THE A.Y . 2000-01. 2.2. IT IS SUBMITTED THAT THE DECISION RELIED UPON BY THE LEARNED CIT (A) IN DECIDING THE ISSUE HAS NOT BECOM E FINAL AND APPEAL HAS BEEN PREFERRED BEFORE THE HON' BLE MADRAS HIGH COURT. 3.1 THE LEARNED CIT(A) ERRED IN HOLDING THAT DISALLOWANCE OF INTEREST OF ` 5,52,933/- MADE BY THE ASSESSING OFFICER WAS NOT CALLED FOR, THEREBY, DELE TING THE SAID ADDITION. 3.2 IN THE ABSENCE OF ANY FINDING GIVEN BY THE LEA RNED CIT (A) AS TO THE COMMERCIAL EXPEDIENCY TO THE ASSESSEE IN THE MATTER OF DIVERTING INTEREST BEARIN G FUNDS TO SISTER CONCERNS WITHOUT CHARGING INTEREST, THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE O F M/S S.A.BUILDERS LTD. VS CIT, 288 ITR 1, WILL NOT A PPLY TO THE FACTS OF THE CASE UNDER CONSIDERATION. 4. FOR THESE AND OTHER GROUNDS THAT MAY BE ADDUCED AT THE TIME OF HEARING, IT IS PRAYED THAT THE ORDER OF THE LEARNED CIT(A) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER RESTORED. 2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE P ERUSED THE ENTIRE MATERIAL AVAILABLE ON RECORD. AS IS EV IDENT FROM THE GROUNDS ITSELF, BOTH THE ISSUES STAND COVERED IN FA VOUR OF THE ASSESSEE. FIRST ISSUE REGARDING BAD DEBTS TAKEN VIDE GROUND N OS.2.1 & 2.2 IS COVERED BY THE ORDER OF THE TRIBUNAL AND THE SECOND ISSUE TAKEN VIDE GROUND NOS.3.1 & 3.2 STAND COVERED BY THE DECISION OF HON'BLE SUPREME COURT RENDERED IN THE CASE OF S.A.BUILDERS LTD VS CIT, 288 ITR 1. THEREFORE, WE CANNOT INTERFERE IN THE IMPUG NED FINDING OF THE ITA 1615/09 :- 3 -: LD. CIT(A) WHICH ARE BASED ON DECISIONS REFERRED TO ABOVE, AND DISMISS THE APPEAL OF THE REVENUE. 3. IN THE RESULT, APPEAL OF THE REVENUE STANDS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT O N 10.10.2011. SD/- SD/- (DR. O.K. NARAYANAN) VICE-PRESIDENT (HARI OM MARATHA) JUDICIAL MEMBER DATED: 10 TH OCTOBER, 2011 RD COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR