ACIT, Circle - 54, Kolkata, Kolkata V. M/s. Lovelock & Lews, Kolkata

ITA 168/KOL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54735 (ITAT-KOLKATA)
• Duration Of Justice: 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 1998-1999
• Appeal Filed On: 25-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K PRAMANICK
• Assessee Lawyers: S DE A R
• Keywords: Proportionate interest; Question of law

Judgement Text

, ' , , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA ( ) . . , , , , , , ) [BEFORE SRI S.V. MEHROTRA, A.M. & SRI MAHAVIR SING H, J.M.] ! ! ! ! / I.T.A NO. 168/KOL/2011 ASSESSMENT YEAR : 1998-1999 ASSISTANT COMMISSIONER OF INCOME TAX, -VS.- M/S. LOVELOCK & LEWS, KOLKATA CIRCLE-54, KOLKATA (PAN : AAB FL 5878 A) ( '# /APPELLANT ) ( $%'# / RESPONDENT ) FOR THE APPELLANT ( '# ) : SHRI A.K. PRAMANICK, D.R. FOR THE RESPONDENT ( $%'# ) : SHRI S. DE, A.R. &' ( ) * &' ( ) * &' ( ) * &' ( ) * /DATE OF HEARING : 21.12.2011 +, ) +, ) +, ) +, ) * * * * /DATE OF PRONOUNCEMENT : 21.12.2011 - / ORDER PER SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER/ . . , :- THE REVENUE HAD FILED THIS APPEAL AGAINST THE ORDE R DATED 23.11.2010 OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-XXXVI, KOLKATA FOR THE ASSESSMENT YEAR 1998-99. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, A FIRM OF CHARTERED ACCOUNTANTS, FILED ITS RETURN OF INCOME ON 30.10.1998 DECLARING TOTAL INCO ME OF RS.2,60,96,730/-. THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD CLAIMED INTER EST ON BORROWED CAPITAL AMOUNTING TO RS.37,09,384/- AND RS.26,69,971/- ON O.D. ACCOUNT. HE FURTHER NOTICED FROM THE DETAILS OF THE OTHER CURRENT ASSETS THAT RS.5,46,865/- AND RS.47,7 0,438/- WERE RECEIVABLE AGAINST LOVELOCK LEWES & ASSOCIATES AND M/S. LOVELOCK LEWES SERVICES PVT. LTD. RESPECTIVELY. HE POINTED OUT THAT BOTH THESE CONCERNS WERE THE SISTER CONCERNS O F THE ASSESSEE AND, THEREFORE, THERE WOULD HAVE BEEN NO NEED TO TAKE INTEREST BEARING LOANS/ A DVANCES, HAD NOT THE INTEREST-FREE ADVANCE/LOANS BEING MADE TO SISTER CONCERN. AFTER C ONSIDERING THE ASSESSEES EXPLANATION HE DISALLOWED THE PROPORTIONATE INTEREST IN RESPECT OF O.D. A/C. OF RS.6,91,886/-. LD. CIT(APPEALS) DELETED THE DISALLOWANCE FOLLOWING THE TRIBUNALS ORDER IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEARS 2000-01, 2002-03 AND 2003- 04. BEING AGGRIEVED, THE DEPARTMENT IS IN APPEAL BEFORE THE TRIBUNAL. 3. HAVING HEARD BOTH THE PARTIES, WE FIND THAT THIS ISSUE IS COVERED BY THE ORDER OF TRIBUNAL DATED 17.01.2007 FOR ASSESSMENT YEARS 2001-02 AND 2 002-03 IN ASSESSEES OWN CASE IN ITA ITA NO. 168/KOL./2011 2 NOS. 976 & 977/KOL./2006, WHICH HAS BEEN PLACED AT PAGES 101-114 OF THE PAPER BOOK, AND ALSO BY THE ORDER OF TRIBUNAL DATED 25.01.2008 IN I TA NO. 404/KOL./2007 FOR ASSESSMENT YEAR 2003-04, COPY OF WHICH IS PLACED AT PAGES 117 TO 12 3 OF THE PAPER BOOK. LD. COUNSEL FURTHER POINTED OUT THAT THE DEPARTMENT HAD PREFERRED THE A PPEAL AGAINST THE ORDER OF TRIBUNAL FOR ASSESSMENT YEAR 2003-04, WHICH HAS BEEN DISMISSED B Y THE HONBLE JURISDICTIONAL HIGH COURT OBSERVING AS UNDER :- WE HAVE PERUSED THE ORDER PASSED BY THE LEARNED TR IBUNAL. IT APPEARS THAT THE QUESTION INVOLVED HAS ALREADY BEEN SETTLED BY THE HONBLE APEX COURT IN THE CASE OF CIT VS.- MADRAS AUTO SERVICES P. LTD. [233 ITR 468 (SC)]. IN VIEW OF THAT WE DO NOT FIND ANY REASON TO INTER FERE WITH THE ORDER SO PASSED BY THE LEARNED TRIBUNAL NOR THE ORD ER SO PASSED BY THE LEARNED TRIBUNAL SUFFERS FROM ANY LEGAL INFIRMITY N OR WE FIND THAT ANY SUBSTANTIAL QUESTION OF LAW IS INVOLVED IN THIS APP EAL. HENCE, THE APPEAL BEING ITA NO. 455 OF 2008 IS DISMISSED. 4. IT IS EVIDENT THAT THIS ISSUE IS SQUARELY COVERE D BY VARIOUS DECISIONS OF TRIBUNAL AS WELL AS BY THE DECISION OF THE HONBLE KOLKATA HIGH COUR T. THEREFORE, RESPECTFULLY FOLLOWING THE SAME, WE REJECT THE GROUND OF APPEAL RAISED BY THE REVENUE. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21/ 12 /2011. & . / - 21/12/2011. SD/- SD/- [ MAHAVIR SINGH / ] [S.V. MEHROTRA/ ( . . )] JUDICIAL MEMBER/ ACCOUNTANT MEMBER/ DATED : 21/ 12/ 2011 COPY OF THE ORDER FORWARDED TO: 1. M/S. LOVELOCK & LEWS, PLOT NO. Y/14, BLOCK-EP, SECT OR-V, SALT LAKE ELECTRONICS COMPLEX, KOLKATA-91. 2 ACIT, CIRCLE-54, KOLKATA, 3, GOVT. PLACE (WEST), KO LKATA-1, 3. COMMISSIONER OF INCOME-TAX (APPEALS) , KOLKATA 4. CIT , KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA (TRUE COPY) BY ORDER ASSISTANT REGISTRAR, I.T.A.T., KOLKATA LAHA, SR. P.S.