Anil Kumar Bansal, Hisar V. ITO, Ward- 1, Hisar

ITA 2320/DEL/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6594 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 15-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Business income; Depreciation; Question of law; Capital receipt
• Section: 28; 36 (1) (iii)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI A BEN CH, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NO. 2320/DEL/2019 [ASSESSMENT YEAR: 2015-16] SHRI ANIL KUMAR BANSAL, 2030/4, MOHALLA RAMPURA, HISAR INCOME TAX OFFICER, WARD-1, HISAR PAN - ABQPB8751N APPELLANT RESPONDENT ITA NO. 2321/DEL/2019 [ASSESSMENT YEAR: 2015-16] SHRI SUNIL KUMAR BANSAL, 2030/4, MOHALLA RAMPURA, HISAR INCOME TAX OFFICER, WARD-1, HISAR PAN - ABQPB6535N APPELLANT RESP ONDENT ITA NO. 2322/DEL/2019 [ASSESSMENT YEAR: 2015-16] SHRI PAWAN KUMAR BANSAL, 2030/4, MOHALLA RAMPURA, HISAR INCOME TAX OFFICER, WARD-1, HISAR PAN - ADGPB3493H APPELLANT RESPONDENT APPELLANT BY SHRI GAUTAM JAIN & SHRI LALIT MOHAN RESPONDENT BY SHRI RINKU SINGH DATE OF HEARING 01/08 /2019 DATE OF PRONOUNCEMENT 02 /08 /2019 2 ITA NO.2320 TO 2022/DEL/2 017 ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THESE THREE APPEALS ARE BY THREE DIFFERENT ASSESSEE S AGAINST THREE SEPARATE ORDERS OF THE LD. CIT(A), PERTAINING TO AY 2015-16. 2. REPRESENTATIVES OF BOTH SIDES AGREED THAT THE UN DERLYING FACTS IN THE ISSUES ARE IDENTICAL IN RESPECT OF THE ALL APPELLANTS. ON SUCH CONCESSION, WE HEARD THE APPEAL IN ITA NO.2320/DEL/2019. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E OPENING CAPITAL OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION WAS (-)60,49,22 7/- WHICH BECAME RS.(-) 31,30,15,182/- AT THE END OF THE YEAR. THE ASSESSIN G OFFICER FOUND THAT THE CAPITAL OF THE ASSESSEE HAS INCREASED BY RS.2,91,90,644/-. WHEN AS KED, THE ASSESSEE EXPLAINED THAT THE MAIN FACTORS FOR INCREASE IN THE CAPITAL ARE CU RRENT YEARS BUSINESS INCOME OF RS.14,63,875/- AND A SUM OF RS.2,31,98,954/- WHICH WAS WRITTEN OFF OUT OF ABN AMROS LOAN ACCOUNT. THE ASSESSEE EXPLAINED THAT THE OFFER LETTER FROM THE M/S ROAYL BANK OF SCOTLAND DATED 23/01/2012 FOR ONE TIME SETTLEMENT O F THE LOAN WAS ACCEPTED. ON PERUSAL, THE AO FOUND THAT THE ASSESSEE HAS TAKEN L OAN JOINTLY WITH HIS BROTHER SHRI SUNIL BANSAL AND PAWAN BANSAL (OTHER TWO APPELLANTS UNDER CONSIDERATION). THE AO FURTHER OBSERVED THAT THE TOTAL OUTSTANDING BALANCE IN THE LOAN ACCOUNT WAS RS.1532.79 LAKH WHICH COMPRISING OF PRINCIPAL OF RS.1342.52 LAKHS A ND UNPAID INTEREST OF RS.190.27 LAKHS . THE AO FURTHER NOTICED THAT THE BANK HAD GIVEN OF FER TO PAY A SUM OF RS.706.23 LAKH IN FULL AND FINAL SETTLEMENT OF COMPLETE OUTSTANDING A MOUNT. 3 ITA NO.2320 TO 2022/DEL/2 017 4. ACCORDING TO THE AO, THE TOTAL OUTSTANDING BALAN CE OF THE LOAN RELATED TO THE ASSESSEE WAS RS.384.91 LAKHS AND THE ASSESSEE HAS T RANSFERRED WAIVED OFF AMOUNT OF RS.2,31,98,954/- IN THE CAPITAL ACCOUNT OF THE ASSE SSEE, THEREFORE, THE ASSESSEE WAS ASKED TO EXPLAIN WHY WAIVED THE AMOUNT SHOULD NOT B E TREATED AS INCOME U/S 28(IV) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 5. THE ASSESSEE FILED A DETAILED REPLY CLAIMING THA T THE PROVISIONS OF SECTION 28(IV) OF THE ACT DID NOT APPLY ON THE FACTS OF THE CASE AND IN SUPPORT OF RELIED UPON SEVERAL JUDICIAL DECISIONS. 6. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSE E, THE AO WAS OF THE OPINION THAT THE PROVISIONS OF SECTION 28(IV) OF THE ACT SQUAREL Y APPLY ON THE FACTS AND HEAVILY DRAWING SUPPORT FROM THE DECISION OF THE HONBLE SUPREME CO URT IN THE CASE OF T.V. SUNDARAM IYENGAR & SONS. THE AO MADE THE ADDITION OF RS.2,31 ,98,954/-. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BUT WITHOUT ANY SU CCESS. 7. BEFORE THE LD. CIT(A), RELIANCE WAS PLACED ON TH E DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF MAHINDRA & MAHINDRA MI LLS LTD. HOWEVER, THE LD. CIT(A) WAS CONVINCED THAT THE FACTS OF MAHINDRA & MAHINDRA MILLS LTD. ARE CLEARLY DISTINGUISHABLE FROM THE FACTS OF THE ASSESSEES CA SE AND DRAWING SUPPORT FROM THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F T.V. SUNDARAM IYENGER & SONS CONFIRMED THE ADDITIONS MADE BY THE AO. 8. BEFORE US, THE COUNSEL FOR THE ASSESSEE REITERAT ED THAT THE PROVISIONS OF SECTION 28(IV) OF THE ACT APPLY ON THE FACTS OF THE CASE IN HAND AND ONCE AGAIN RELIED UPON THE 4 ITA NO.2320 TO 2022/DEL/2 017 DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F MAHINDRA & MAHINDRA MILLS LTD. 404 ITR 1. 9. PER CONTRA, THE LD. DR STRONGLY SUPPORTED THE FI NDINGS OF THE LD. CIT(A). 10. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORDERS OF THE AUTHORITIES BELOW. IN OUR CONSIDERED OPINION, THE DECISION OF THE HONBLE SUPREME COURT RELIED UPON BY THE LD. AO AND UPHELD BY THE LD. CIT(A) IN THE CASE OF T.V. SUNDARAM IYENGER IS MISPLACED AND HAS BEEN WRONGLY APPLIED. IN OUR CONSIDERED VIE W THAT APPLICABILITY OF SECTION 28(IV) OF THE ACT HAS BEEN DISCUSSED BY THE HONBLE SUPREM E COURT IN THE CASE OF MAHINDRA & MAHINDRA MILLS LTD. 404 ITR 1, WHEREIN, THE HONBLE SUPREME COURT HAS REVERSED THE DECISION OF THE HONBLE MADRAS HIGH COURT IN CASE O F CIT VS RAMANIYAM HOMES PVT. LTD. 384 ITR 530. THE RELEVANT FINDINGS OF THE HON BLE SUPREME COURT READ AS UNDER:- 12) THE FIRST ISSUE IS THE APPLICABILITY OF SECTION 28 (IV) OF THE IT ACT IN THE PRESENT CASE. BEFORE MOVING FURTHER, WE DEEM IT APPOSITE TO REPRODUCE THE RELEVANT PROVISION HEREIN BELOW:- 28. PROFITS AND GAINS OF BUSINESS OR PROFESSION.TH E FOLLOWING INCOME SHALL BE CHARGEABLE TO INCOME-TAX UNDER THE HEAD P ROFITS AND GAINS OF BUSINESS PROFESSION,-- X X X (IV) THE VALUE OF ANY BENEFIT OR PERQUISITE, WHETHER CONVERTIBLE INTO MONEY OR NOT, ARISING FROM BUSINESS OR THE EXERCISE OF A PROFESSION; 13) ON A PLAIN READING OF SECTION 28 (IV) OF THE IT ACT, PRIMA FACIE, IT APPEARS THAT FOR THE APPLICABILITY OF THE SAID PROVISION, THE IN COME WHICH CAN BE TAXED SHALL ARISE FROM THE BUSINESS OR PROFESSION. ALSO, IN ORDER TO INVOKE THE PROVISION OF SECTION 28 (IV) OF THE IT ACT, THE BENEFIT WHICH IS RECEIVED HAS TO BE IN SOME OTHER FORM RATHER THAN IN THE SHAPE OF MONEY. IN THE PRESENT C ASE, IT IS A MATTER OF RECORD THAT THE AMOUNT OF RS. 57,74,064/- IS HAVING RECEIVED AS CASH RECEIPT DUE TO THE WAIVER OF LOAN. THEREFORE, THE VERY FIRST CONDITION OF SECT ION 28 (IV) OF THE IT ACT WHICH SAYS ANY BENEFIT OR PERQUISITE ARISING FROM THE BUS INESS SHALL BE IN THE FORM OF BENEFIT OR PERQUISITE OTHER THAN IN THE SHAPE OF MO NEY, IS NOT SATISFIED IN THE PRESENT CASE. HENCE, IN OUR VIEW, IN NO CIRCUMSTANC ES, IT CAN BE SAID THAT THE AMOUNT OF RS 57,74,064/- CAN BE TAXED UNDER THE PRO VISIONS OF SECTION 28 (IV) OF THE IT ACT. 14) ANOTHER IMPORTANT ISSUE WHICH ARISES IS THE APP LICABILITY OF THE SECTION 41 (1) OF THE IT ACT. THE SAID PROVISION IS RE-PRODUCED AS UND ER: 5 ITA NO.2320 TO 2022/DEL/2 017 41. PROFITS CHARGEABLE TO TAX.- (1) WHERE AN ALLOW ANCE OR DEDUCTION HAS BEEN MADE IN THE ASSESSMENT FOR ANY YEAR IN RESPECT OF LOSS, EXPENDITURE OR TRADING LIABILITY INCURRED BY THE ASSESSEE (HEREINA FTER REFERRED TO AS THE FIRST- MENTIONED PERSON) AND SUBSEQUENTLY DURING ANY PREVI OUS YEAR,- (A) THE FIRST-MENTIONED PERSON HAS OBTAINED, WHETHE R IN CASH OR IN ANY OTHER MANNER WHATSOEVER, ANY AMOUNT IN RESPECT OF SUCH LO SS OR EXPENDITURE OR SOME BENEFIT IN RESPECT OF SUCH TRADING LIABILITY B Y WAY OF REMISSION OR CESSATION THEREOF, THE AMOUNT OBTAINED BY SUCH PERS ON OR THE VALUE OF BENEFIT ACCRUING TO HIM SHALL BE DEEMED TO BE PROFI TS AND GAINS OF BUSINESS OR PROFESSION AND ACCORDINGLY CHARGEABLE TO INCOME- TAX AS THE INCOME OF THAT PREVIOUS YEAR, WHETHER THE BUSINESS OR PROFESS ION IN RESPECT OF WHICH THE ALLOWANCE OR DEDUCTION HAS BEEN MADE IS IN EXIS TENCE IN THAT YEAR OR NOT; OR 15) ON A PERUSAL OF THE SAID PROVISION, IT IS EVIDE NT THAT IT IS A SINE QUA NON THAT THERE SHOULD BE AN ALLOWANCE OR DEDUCTION CLAIMED B Y THE ASSESSEE IN ANY ASSESSMENT FOR ANY YEAR IN RESPECT OF LOSS, EXPENDI TURE OR TRADING LIABILITY INCURRED BY THE ASSESSEE. THEN, SUBSEQUENTLY, DURING ANY PREV IOUS YEAR, IF THE CREDITOR REMITS OR WAIVES ANY SUCH LIABILITY, THEN THE ASSES SEE IS LIABLE TO PAY TAX UNDER SECTION 41 OF THE IT ACT. THE OBJECTIVE BEHIND THIS S ECTION IS SIMPLE. IT IS MADE TO ENSURE THAT THE ASSESSEE DOES NOT GET AWAY WITH A D OUBLE BENEFIT ONCE BY WAY OF DEDUCTION AND ANOTHER BY NOT BEING TAXED ON THE BEN EFIT RECEIVED BY HIM IN THE LATER YEAR WITH REFERENCE TO DEDUCTION ALLOWED EARL IER IN CASE OF REMISSION OF SUCH LIABILITY. IT IS UNDISPUTED FACT THAT THE RESPONDEN T HAD BEEN PAYING INTEREST AT 6 % PER ANNUM TO THE KJC AS PER THE CONTRACT BUT THE AS SESSEE NEVER CLAIMED DEDUCTION FOR PAYMENT OF INTEREST UNDER SECTION 36 (1) (III) OF THE IT ACT. IN THE CASE AT HAND, LEARNED CIT (A) RELIED UPON SECTION 41 (1) OF THE IT ACT AND HELD THAT THE RESPONDENT HAD RECEIVED AMORTIZATION BENEFIT. AMORT IZATION IS AN ACCOUNTING TERM THAT REFERS TO THE PROCESS OF ALLOCATING THE COST O F AN ASSET OVER A PERIOD OF TIME, HENCE, IT IS NOTHING ELSE THAN DEPRECIATION. DEPREC IATION IS A REDUCTION IN THE VALUE OF AN ASSET OVER TIME, IN PARTICULAR, TO WEAR AND T EAR. THEREFORE, THE DEDUCTION CLAIMED BY THE RESPONDENT IN PREVIOUS ASSESSMENT YE ARS WAS DUE TO THE DEPRECATION OF THE MACHINE AND NOT ON THE INTEREST PAID BY IT. 16) MOREOVER, THE PURCHASE EFFECTED FROM THE KAISER JEEP CORPORATION IS IN RESPECT OF PLANT, MACHINERY AND TOOLING EQUIPMENTS WHICH ARE CAPITAL ASSETS OF THE RESPONDENT. IT IS IMPORTANT TO NOTE THAT THE SAID P URCHASE AMOUNT HAD NOT BEEN DEBITED TO THE TRADING ACCOUNT OR TO THE PROFIT OR LOSS ACCOUNT IN ANY OF THE ASSESSMENT YEARS. HERE, WE DEEM IT PROPER TO MENTIO N THAT THERE IS DIFFERENCE BETWEEN TRADING LIABILITY AND OTHER LIABILITY. SECTION 41 (1) OF THE IT ACT PARTICULARLY DEALS WITH THE REMISSION OF TRADING LIABILITY. WHER EAS IN THE INSTANT CASE, WAIVER OF LOAN AMOUNTS TO CESSATION OF LIABILITY OTHER THAN T RADING LIABILITY. HENCE, WE FIND NO FORCE IN THE ARGUMENT OF THE REVENUE THAT THE CASE OF THE RESPONDENT WOULD FALL UNDER SECTION 41 (1) OF THE IT ACT. 17) TO SUM UP, WE ARE NOT INCLINED TO INTERFERE WITH THE JUDGMENT AND ORDER PASSED BY THE HIGH COURT IN VIEW OF THE FOLLOWING REASONS: (A) SECTION 28(IV) OF THE IT ACT DOES NOT APPLY ON T HE PRESENT CASE SINCE THE RECEIPTS OF RS 57,74,064/- ARE IN THE NATURE OF CAS H OR MONEY. 6 ITA NO.2320 TO 2022/DEL/2 017 (B) SECTION 41(1) OF THE IT ACT DOES NOT APPLY SINCE WAIVER OF LOAN DOES NOT AMOUNT TO CESSATION OF TRADING LIABILITY. IT IS A M ATTER OF RECORD THAT THE RESPONDENT HAS NOT CLAIMED ANY DEDUCTION UNDER SECT ION 36 (1) (III) OF THE IT ACT QUA THE PAYMENT OF INTEREST IN ANY PREVIOUS YEAR. 18) IN VIEW OF ABOVE DISCUSSION, WE ARE OF THE CONS IDERED VIEW THAT THESE APPEALS ARE DEVOID OF MERITS AND DESERVE TO BE DISMISSED. A CCORDINGLY, THE APPEALS ARE DISMISSED. ALL THE OTHER CONNECTED APPEALS ARE DISP OSED OFF ACCORDINGLY, LEAVING PARTIES TO BEAR THEIR OWN COST. 11. A SIMILAR VIEW WAS TAKEN BY THE HONBLE HIGH CO URT OF BOMBAY IN THE CASE OF CIT VS XYLON HOLDINGS (P.) LTD. [2012] 211 TAXMAN 108 ( BOM.), WHEREIN, HONBLE BOMBAY HIGH COURT HAS NOT ONLY CONSIDERED THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF MAHINDRA & MAHINDRA MILLS LTD. BUT HAS ALSO CONS IDERED THE DECISION IN THE CASE OF T.V. SUNDARAM IYNGER, THE RELEVANT FINDINGS OF THE HONBLE BOMBAY HIGH COURT READ AS UNDER:- 4) THE COMMISSIONER OF INCOME TAX (APPEALS) BY AN OR DER DATED 31/10/2008 ALLOWED THE RESPONDENT-ASSESSEE'S APPEAL. THE COMMIS SIONER OF INCOME TAX (APPEALS) HELD THAT THE LIABILITY TO REPAY A LOAN T AKEN TOWARDS THE PURCHASE OF A MOTOR CAR WHICH HAD CEASED CANNOT BE SUBJECTED TO T AX. THIS IS FOR THE REASON THAT THE EXTINGUISHMENT OF THE LOAN WHICH WAS TAKEN FOR THE PURCHASE OF A CAPITAL ASSET LIKE A MOTOR CAR IS NOT A REVENUE RECEIPT. HE NCE, THE SAME IS NOT TAXABLE. 5) THE APPEAL BY THE REVENUE TO THE TRIBUNAL ON THE A FORESAID ISSUE WAS DISMISSED BY AN ORDER DATED 13/8/2009. THE TRIBUNAL HELD THAT THE CESSATION OF LIABILITY TO REPAY A LOAN TAKEN TO PURCHASE A CAPIT AL ASSET DOES NOT RESULT IN A REVENUE RECEIPT. FURTHER, THE AMOUNT OF RS.29.17 LAC S WAS NOT TAXABLE UNDER SECTION 41(1) OF THE ACT AS THE SAME WAS NOT AN EXP ENDITURE INCURRED IN THE EARLIER YEARS. THE ISSUE ACCORDING TO THE TRIBUNAL W AS COVERED IN FAVOUR OF THE RESPONDENT-ASSESSEE BY A DECISION OF THIS COURT IN THE MATTER OF MAHINDRA AND MAHINDRA LTD. V. COMMISSIONER OF INCOME TAX REPORTED IN 261 ITR 501. CONSEQUENTLY, THE TRIBUNAL HELD THAT AMOUNT OF RS.29 .17 LACS IS NOT TAXABLE EITHER UNDER SECTION 41(1) OR 28(IV) OF THE ACT. 6) IN SUPPORT OF THE APPEAL, MR. VIMAL GUPTA, THE L EARNED COUNSEL FOR THE REVENUE CONTENDS THAT THE DECISION IN THE MATTER OF MAHINDR A AND MAHINDRA LIMITED (SUPRA) WOULD NOT BE APPLICABLE IN VIEW OF THE SUBS EQUENT DECISION OF THIS COURT IN THE MATTER OF SOLID CONTAINERS LTD. V. DEPUTY CO MMISSIONER OF INCOME TAX REPORTED IN 308 ITR 407. IN THE ABOVE CASE, THIS COU RT HAS DISTINGUISHED THE DECISION RENDERED IN THE MATTER OF MAHINDRA AND MAH INDRA LIMITED (SUPRA) AND HELD THAT WAIVER OF LOAN TAKEN FOR TRADING ACTIVITY WOULD BECOME THE ASSESSEE'S INCOME AND BE SUBJECT TO TAX. ALTERNATIVELY, MR. GU PTA SUBMITS THAT THE LOAN 7 ITA NO.2320 TO 2022/DEL/2 017 AMOUNT WRITTEN OFF WOULD BE TAXABLE UNDER SECTION 2 8(IV) OF THE ACT AS A BENEFIT ARISING FROM BUSINESS. 7) AS AGAINST THE ABOVE, MR. PARDIWALLA, COUNSEL FO R THE RESPONDENT-ASSESSEE SUBMITS THAT THE ISSUE ARISING IN THIS APPEAL WOULD STAND COVERED BY THE DECISION OF THIS COURT IN THE MATTER OF MAHINDRA & MAHINDRA LTD. (SUPRA). ACCORDING TO HIM, THE DECISION OF THIS COURT IN THE MATTER OF SOLID C ONTAINERS (SUPRA) IS NOT APPLICABLE AS IN THAT CASE THE LOAN WAS TAKEN FOR B USINESS PURPOSES AND NOT FOR PURCHASE OF A CAPITAL ASSET AS IN THIS CASE. SO FAR AS THE ALTERNATIVE SUBMISSION IS CONCERNED, MR. PARDIWALLA SUBMITS THAT SECTION 28(I V) OF THE ACT WOULD NOT APPLY TO ANY BENEFIT RECEIVED IN CASH OR MONEY AS IN THIS CASE. THIS ISSUE ACCORDING TO MR. PARDIWALLA IS ALSO COVERED BY THE DECISION OF T HIS COURT IN THE MATTER OF MAHINDRA & MAHINDRA LTD. (SUPRA).THEREFORE, HE SUBMI TS THAT THE APPEAL SHOULD NOT BE ENTERTAINED. 8) WE HAVE CONSIDERED THE SUBMISSIONS. THE ISSUE ARI SING IN THIS CASE STAND COVERED BY THE DECISION OF THIS COURT IN THE MATTER OF MAHINDRA & MAHINDRA (SUPRA).THE DECISION OF THIS COURT IN THE MATTER OF SOLID CONTAINERS (SUPRA) IS ON COMPLETELY DIFFERENT FACTS AND INAPPLICABLE TO THIS CASE. IN THE MATTER OF SOLID CONTAINERS (SUPRA) THE ASSESSEE THEREIN HAD TAKEN A LOAN FOR BUSINESS PURPOSE. IN VIEW OF THE CONSENT TERMS ARRIVED AT, THE AMOUNT OF LOAN TAKEN WAS WAIVED BY THE LENDER. THE CASE OF THE ASSESSEE THEREIN WAS THA T THE LOAN WAS A CAPITAL RECEIPT AND HAS NOT BEEN CLAIMED AS DEDUCTION FROM THE TAXABLE INCOME IN THE EARLIER YEARS AND WOULD NOT COME WITHIN THE PURVIEW OF SECTION 41(1) OF THE ACT. HOWEVER, THIS COURT BY PLACING RELIANCE UPON THE DE CISION OF THE APEX COURT IN THE MATTER OF CIT V. T.V. SUNDARAM IYENGAR AND SONS LTD. 222 ITR 344 HELD THAT THE LOAN WAS RECEIVED BY THE ASSESSEE FOR CARRYING ON ITS BUSINESS AND THEREFORE, NOT A LOAN TAKEN FOR THE PURCHASE OF CAPITAL ASSETS . CONSEQUENTLY, THE DECISION OF THIS COURT IN THE MATTER OF MAHINDRA AND MAHINDRA L IMITED (SUPRA) WAS DISTINGUISHED AS IN THE SAID CASE THE LOAN WAS TAKE N FOR THE PURCHASE OF CAPITAL ASSETS AND NOT FOR TRADING ACTIVITIES AS IN THE CAS E OF SOLID CONTAINERS LIMITED (SUPRA). IN VIEW OF THE ABOVE, THE DECISION OF THIS COURT IN THE MATTER OF SOLID CONTAINERS LIMITED (SUPRA) WILL HAVE NO APPLICATION TO THE FACTS OF THE PRESENT CASE AND THE MATTER STANDS COVERED BY THE DECISION OF THIS COURT IN THE MATTER OF MAHINDRA & MAHINDRA LIMITED (SUPRA). THE ALTERNATIVE SUBMISSION THAT THE AMOUNT OF LOAN WRITTEN OFF WOULD BE TAXABLE UNDER S ECTION 28(IV) OF THE ACT ALSO CAME UP FOR CONSIDERATION BEFORE THIS COURT IN THE MATTER OF MAHINDRA & MAHINDRA LIMITED (SUPRA) AND IT WAS HELD THEREIN THAT SECTIO N 28(IV) OF THE ACT WOULD APPLY ONLY WHEN A BENEFIT OR PERQUISITE IS RECEIVED IN KI ND AND HAS NO APPLICATION WHERE BENEFIT IS RECEIVED IN CASH OR MONEY. 9) IN VIEW OF THE ISSUE ARISING IN THIS APPEAL BEIN G COVERED BY THE DECISION OF THIS COURT IN THE MATTER OF MAHINDRA & MAHINDRA LTD.(SUP RA), NO SUBSTANTIAL QUESTION OF LAW ARISES AND BOTH THE QUESTIONS ARE DISMISSED 12. AS MENTIONED ELSEWHERE, THE LD. CIT(A) HAS INCO RRECTLY APPLIED THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF T. V. SUNDARAM IYENGER 222 ITR 344 WHEREAS THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF MAHINDRA & 8 ITA NO.2320 TO 2022/DEL/2 017 MAHINDRA MILLS LTD. (SUPRA) SQUARELY APPLIED ON THE FACTS OF THE CASE IN HAND AND ALSO THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CA SE OF XYLON HOLDINGS (P.) LTD. (SUPRA). 13. CONSIDERING THE TOTALITY OF FACTS IN THE LIGHT OF RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF MHAINDRA & MAHINDRA MI LLS LTD. (SUPRA), WE DIRECT THE AO TO DELETE THE IMPUGNED DISALLOWANCE FROM THE HANDS OF THE ALL THE APPELLANTS. 14. IN THE RESULT, CAPTIONED APPEALS ARE ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 02 /08/2019 SD/- SD/- [SUCHITRA KAMBLE] [N.K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DELHI; DATED: 02/08/2019. F{X~{T? F{X~{T? F{X~{T? F{X~{T? FA FA FA FA P.S P.SP.S P.S COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI