M/s. CYBERTECH SYSTEMS & SOFTWARE LTD., THANE V. ACIT Rg. - 8(1), MUMBAI

ITA 2358/MUM/2006

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100577 (ITAT-MUMBAI)
• Duration Of Justice: 9 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 25-03-2015
• Assessment Year: 1997-1998
• Appeal Filed On: 18-04-2006
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S PADMAJA
• Keywords: Business income
• Section: 10B; 6; 10; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI . , , BEFORE SHRI D. MANMOHAN , VP AND SHRI SANJAY ARORA, AM ./ I.T. A. NO S . 3655 , 3656 & 3657 /MUM/2006 ( / ASSESSMENT YEAR: 1997 - 98 , 1998 - 99 & 1999 - 200 0 ) DY. CIT, RANGE - 8(1), ROOM NO. 210, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI - 400 020 / VS. CYBERTECH SYSTEMS & SOFTWARE P. LTD. CYBERTECH HOUSE, PLOT NO. B - 63/64/65, ROAD NO. 21/34, J. B. SAWANT MARG, MIDC, WAGLE ESTATE, MUMBAI - 400 604 ./ ./ PAN/GIR NO. AAACC 1905 B ( / REVENUE ) : ( / ASSESSEE ) & ./ I.T.A. NO S . 2358 , 2359 & 2360 /MUM/2006 ( / ASSESSMENT YEAR: 1997 - 98 , 1 998 - 99 & 1999 - 2000 ) CYBERTECH SYSTEMS & SOFTWARE P. LTD. CYBERTECH HOUSE, PLOT NO. B - 63/64/65, ROAD NO. 21/34, J. B. SAWANT MARG, MIDC, WAGLE ESTATE, MUMBAI - 400 604 / VS. DY. CIT, RANGE - 8(1), ROOM NO. 210, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI - 400 020 ./ ./ PAN/GIR NO. AAACC 1905 B ( / ASSESSEE ) : ( / REVENUE ) / REVENUE BY : MS. S. PADMAJA / / ASSESSEE BY : SHRI YOGESH THAR / DATE OF HEARING : 08.05.2015 / DATE OF PRONOUNCEMENT : 07 .08.2015 2 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. / O R D E R PER SANJAY ARORA, A. M.: THESE ARE A SET OF THREE C ROSS A PPEALS, I.E., BY THE ASSESSEE AND THE REVENUE FOR THREE CONSECUTIVE YEARS, ARISING OUT OF SEPARATE ORDER S BY THE COMMISSIONER OF INCOME TAX (APPEALS) - VIII, MUMBAI (CIT(A) FOR SHORT) DATED 29.03.2006 (FOR ASSESSMENT YEAR S (A.Y S .) 1997 - 98 AND 1998 - 99) AND 30.03.2006 (FOR A.Y. 1999 - 2000) , PARTLY ALLOWING THE A SSESSEES APPEAL S CONTESTING T HE LEVY OF PENALTY U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) BY THE ASSESSING OFFICER (A.O.) FOR THE SAID YEARS. 2. THE ONLY ISSUE ARISING IN THE SE APPEALS IS THE MAINTAINABILITY OR OTHERWISE IN LAW OF THE PENALTY LEVIED U/S.271(1 )(C) OF THE ACT AS CONFIRMED OR DELETED BY THE LD. C IT(A) IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE PRINCIPAL RECEIPT (INCOME) ON WHICH THE PENALTY STANDS DELETED BY THE FIRST APPELLATE AUTHORITY IS ON ACCOUNT OF INTEREST RECEIPT CONSEQUENT TO T HE DENIAL OF DEDUCTION U/S. 10B CLAIMED BY THE ASSESSEE IN ITS RESPECT IN ASSESSMENT FOLLOWING THE DECISION BY THE HONBLE APEX COURT IN LIBERTY INDIA VS. CIT [2009] 317 ITR 218 (SC) . THIS IS A SUBSISTING ISSUE WITH THE REVENUE IN THE ASSESSEES CASE, CONT INUING , AS FAR AS WE CAN SEE, SINCE A.Y. 1996 - 97. THE ASSESSEES CASE 4.1 THE ASSESSEE CONTENDS TO HAVE CLAIM ED BENEFIT U/S.10B ON THE INTEREST INCOME FOLLOWING THE DECISIONS IN THE CASE OF CIT VS. PARAMOUNT PREMISES (P.) LTD. [1991] 190 ITR 259 (BOM) AN D CIT VS. NAGPUR ENGINEERING CO . LTD. [2000] 245 ITR 806 (BOM). IN FACT, AS WOULD BE EVIDENT PER THE SAID DECISIONS, THE HONBLE HIGH COURT HAS ONLY UPHELD THE VIEW AS TAKEN BY THE T RIBUNAL. THE FACT THAT THE HONBLE APEX COURT PER ITS SUBSEQUENT DECISION IN THE CASE OF L IBERTY INDIA ( SUPRA) HAS RULED OTHERWISE WOULD NOT DETRACT FROM THE FACT THAT THE CLAIM FOR DEDUCTION AS MADE BY THE ASSESSEE WAS NOT 3 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. WITHOUT A VALID BASIS OR , IN ANY CASE, A BASIS IN LAW. RATHER, THE SAME ITSELF REFLECTS A CONFLICT IN THE JUDICIAL VIEW AT THE RELEVANT TIME S , PRECLUDING PENALTY. CAN THE ASSESSEE UNDER SUCH CIRCUMSTANCES BE SAID TO HAVE CONCEALED, OR FURNISHED INACCURATE, PARTICULARS OF INCOME, SO AS TO ATTRACT THE PROVISION OF PENALTY U/S. 271(1)(C)? THE REVENUES CASE 4.2 THE REVENUES CASE, ON THE OTHER HAND, IS THAT THERE IS NO BASIS FOR THE ASSESSEE BEING ALLOWED THE BENEFIT OF SEC . 1 0 - B ON ITS INTEREST INCOME. THE SA ID INCOME , AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER ( A.O. ) IN THE ASSESSMENT ORDER FOR A.Y. 1997 - 9 8, THE FIRST OF THE THREE YEARS UNDER REFERENCE, HAS NOTHING TO DO WITH THE ASSESSEES BUSINESS ACTIVITY, ASSESSING THE SAME AS INCOME FROM OTHER SOURCES . LIKEWISE FOR A.Y. 1998 - 99, WHERE THE A.O. HAS AGAIN GIVEN A CATEGORICAL FINDING THAT THE INTEREST IN COME HAS NO NEXUS WITH THE ASSESSEES BUSINESS ACTIVITY. IN THE CASE OF PARAMOUNT PREMISES (P.) LTD. (SUPRA), WHICH WAS SUBSEQUENTLY FOLLOWED BY THE HON'BLE J URISDICTIONAL HIGH COURT IN THE NAGPUR ENGINEERING CO. LTD. (SUPRA), THE ISSUE WAS OF WHETHER THE INTEREST INCOME IS ASSESSABLE AS INCOME FROM BUSINESS OR FROM OTHER SOURCES . THE HONBLE COURT FOUND THAT THE TRIBUNAL HAD GIVEN A DEFINITE FINDING THAT THE INTEREST INCOME SPR A NG F ROM BUSINESS ACTIVITY OF THE ASSESSEE AND DID NOT ARISE OUT OF ANY INDEPEND ENT ACTIVITY AND, THEREFORE, CONFIRMED ITS ASSESSMENT AS BUSINESS INCOME. THE SAID DECISION, BASED ON A FINDING OF FACT, WOULD THUS BE OF NO ASSISTANCE TO THE ASSESSEE. 5 . WE HAVE HEARD THE PARTIES, AND PERUSED THE MATERIAL ON RECORD. 5 .1 SECTION 10B (1), WHICH PROVIDES FOR THE EXEMPTION OF INCOME FROM TAX, AS IT STOOD AT THE RELEVANT TIME, I.E., PRIOR TO ITS SUBSTITUTION BY FINANCE ACT, 2000 W.E.F. 01.04.2001, READS AS UNDER : SPECIAL PROVISIONS IN RESPECT OF NEWLY ESTABLISHED HUNDRED PER CENT EXPORT - ORIENTED UNDERTAKINGS. 10B. (1) SUBJECT TO THE PROVISIONS OF THIS SECTION, ANY PROFITS AND GAINS DERIVED BY A N ASSESSEE FROM A HUNDRED PER CENT EXPORT - ORIENTED UNDERTAKING (HEREAFTER IN THIS SECTION REFERRED TO AS THE UNDERTAKING) TO 4 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. WHICH THIS SECTION AP PLIES SHALL NOT BE INCLUDED IN THE TOTAL INCOME OF THE ASSESSEE. (2) THIS SECTION APPLIES TO ANY UNDERTAKING WHICH FULFILS ALL THE FOLLOWING CONDITIONS, NAMELY: (I) 5 .2 THE HONBLE APEX COURT IN CIT VS. GOVINDA CHOUDHARY AND SONS [1993] 203 ITR 88 1 (SC) CLARIFIED THAT THE INTEREST INCOME PART AKES THE SAME CHARACTER AS THE RECEIPT FOR THE PAYMENT OF WHICH IT WAS OTHERWISE ENTITLED. IN THE FACTS OF THAT CASE, THE CONTRACT AMOUNT S DUE TO THE ASSESSEE, A CONTRACTOR , WERE NOT PAID IN TIME ON ACCOUNT OF D ISPUTES BETWEEN THE PARTIES, AND THE INTEREST WAS AWARDED FOR THE DELAY. THE APEX COURT ADVERTED TO THE SETTLED LAW THAT THE INTEREST INCOME IS ASSESSABLE AS INCOME FROM OTHER SOURCES ONLY WHERE IT CANNOT BE BROUGHT WITHIN ONE OR THE OTHER SPECIFIC HEADS OF CHARGE (INCOME) . IN THE CIRCUMSTA N CES OF THE CASE, IT COULD NOT BE SAID, AS HAD BEEN BY THE TRIBUNAL, THAT THE INTEREST WAS DE HORS THE ASSESSEE - RESPONDENT S BUSINESS, BEING IN FACT INCIDENTAL AND ATTRIBUTABLE TO THE ASSESSEES CONTRACT BUSINESS . 5 .3 IN THE FACTS OF THE PRESENT CASE, THE INTEREST INCOME STANDS EARNED O N DEPOSITS PLACED WITH THE BANK /S FOR FIXED TERM/S (FDRS) AND INTER - CORPORATE DEPOSITS (ICDS). THE A.O. HAS FURTHER GIVEN A CATEGORICAL FINDING OF THE INTER E ST INCOME, WHICH IS EVEN OTHER WISE APPARENT, I.E., FROM THE MANNER IN WHICH IT IS BEING DERIVED, AS HAVING NO DIRECT RELATIONSHIP WITH THE ASSESSEES BUSINESS ACTIVITY, SUPPORTING HIS CASE THROUGH RELIANCE O N A SERIES OF DECISIONS, LISTED IN HIS ORDERS FOR A.YS. 1997 - 98 AND 1998 - 99, SO ME OF WHICH WE ENLIST AS UNDER: 1) ORISSA STATE WAREHOUSING CORP. VS. CIT [1999] 237 ITR 589 (SC); 2) CAMBAY ELECTRIC SUPPLY INDL. CO. LTD. VS. CIT [1978] 113 ITR 84 (SC). 3) CIT VS. RAJA BAHADUR KAMAKHYA NARAYAN SINGH [1948] 16 ITR 325 (PC); 4) CIT VS. K K DOSHI & C O. [2000] 245 ITR 849 (BOM); 5) CIT VS. S. G. JHAVERI CONSULTANCY LTD. [2000] 245 ITR 854 (BOM) 6) SOUTH INDIA SHIPPING CORPORATION VS. CIT [1999] 240 ITR 24 (MAD); 5 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. 7) FENNER (INDIA) LTD. VS. CIT [1999] 239 ITR 480 (MAD); 8) NORTH EAST GASES (PVT.) LTD. VS. CIT [1996 ] 220 ITR 372 (GAU); 9) CIT VS. CEMENT DISTRIBUTORS LTD. [1994] 208 ITR 355 (DEL); AND 10) HINDUSTAN LEVER LTD. VS. CIT [198 0] 121 ITR 951 (BOM). THIS FINDING BY THE A.O. HAS NOT BEEN DISTURBED; RATHER, NOT EVEN CONTESTED BY THE ASSESSEE AT ANY STAGE. THE LD. AU THORIZED REPRESENTATIVE ( AR ) , ON THIS BEING POINTED OUT DURING HEARING, I.E., THAT THE INTEREST INCOME STANDS SPECIFICALLY ASSESSED U/S.56 , I.E., AS INCOME FR O M OTHER SOURCES , FOR A.Y. 1997 - 98, WOULD SUBMIT THAT IT STANDS ASSESSED AS BUSINESS INCOME FOR TH E SUBSEQUENT TWO YEARS. FURTHER, THE TRIBUNAL VIDE ITS ORDER FOR A.Y. 2000 - 01 (PB PGS. 101A TO 101 T ) HELD THAT IN LIGHT OF THE FACT THAT THE ASSESSEE IS ENTITLED TO RELIEF U/S.10B OF THE ACT ON ITS RECEIPT , IT BECOMES NATURALLY ENTITLED TO DEDUCTION THERE - UNDER ON THE INTEREST INCOME. WE FIND LITTLE MERIT IN THE ASSESSEES SAID CONTENTION IN VIEW OF THE UNDISPUTED FACTS OF THE CASE, I.E., OF THE INTEREST INCOME IN THE UNDISPUTED FACTS OF THE CASE ARISING OUT OF BANK FDRS AND ICDS. IN FACT, THE A.O.S FINDI NG THAT THE SAME HAS NO NEXUS WITH THE ASSESSEES BUSINESS , REMAINS UNCHALLENGED. RATHER, THE ASSESSEES PLEA IN THE APPELLATE PROCEEDINGS WAS FOR THE NETTING OF THE INTEREST INCOME IN - AS - MUCH AS THE ASSESSEE HAD ALSO PAID INTEREST. WHILE THE INTEREST INCO ME STANDS SPECIFICALLY ASSESSED AS INCOME FROM OTHER SOURCES FOR A.Y. 1997 - 98, THERE IS NO HEAD - WISE CLASSIFICATION OF THE INCOME FOR A.Y. 1998 - 99 , WHICH TH OUGH CANNOT BE READ TO IMPLY OR MEAN THAT THE SAID INCOME STANDS ASSESSED AS BUSINESS INCOME, PARTIC ULARLY CONSIDERING THE CLEAR FINDING / S IN THE MATTER AND THE UNDISPUTED FACTS OF THE CASE. FOR A.Y. 1999 - 2000, AGAIN, THERE IS A CLEAR REFERENCE BY THE A.O. TO THE REASONS MENTIONED BY HIM IN THE ASSESSMENT ORDER FOR A.Y. 1998 - 99, THE IMMEDIATELY PRECEDING YEAR (REFER PA GE 16 OF THE ASSESSMENT ORDER ) . IN FACT, THE A.O., A N D ONLY RIGHTLY, HAS GONE FURTHER TO STATE THAT THE INTEREST INCOME COULD NOT BE REGARDED AS DERIVED FROM THE ASSESSEES BUSINESS, ADVERTING TO A HOST OF DECISIONS 6 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. EXPLAINING THE RESTRICTED SCOPE OF THE WORD DERIVED, SOME OF WHICH WE QUOTE AS UNDER: I) CAMBAY ELECTRIC SUPPLY INDUSTRIAL CO. LTD. ( SUPRA ); II) STERLING FOODS VS. CIT [ 1985 ] 150 ITR 292 (KAR) [AFFIRMED IN 237 ITR 579 (SC); III) CEMENT DISTRIBUTORS LTD. (SUPRA); IV) NORTH EAST GASES (PVT.) LTD. (SUPRA); V) FENNER (I NDIA ) LTD. VS. CIT [ 1999 ] 239 ITR 480 (MAD) ; AND VI) A. M. MOOS A , BHARAT SEA FOODS VS. CIT [1997] 224 ITR 73 5 TH AT IS TO SAY , THAT THE INTEREST INCOME DOES NOT FORM PART OF THE ASSESSEES BUSINESS, THE SAME COULD NOT IN ANY CASE BE SAID TO BE DERIVED THERE - FROM, A CONDITION PRE C EDENT FOR THE INCOME O F THE ASSESSEES EXPORT BUSINESS FROM BEING ELIGIBLE FOR DEDUCTION U/S. 10B , FOR WHICH REFERENCE MAY BE MADE TO THE PROVIS I ON OF SECTION 10B(1) , REPRODUCED HEREINABOVE . THOUGH, THEREFORE, SURELY, THE A.O. HAS NOT SEGREGATED THE INTEREST INCOME, STATING THE SAME TO HAVE BEEN FOUND TO BE BUSINESS INCOME WOULD BE CLEARLY INCORRECT IN VIEW OF HIS CLEAR FINDING OF IT BEING NOT CONNECTED WITH THE ASSESSEES BUSINESS ACTIVITY BUT ONLY BY WAY OF INTEREST ON SURPLUS FUNDS, I.E., FOR THE TIME BEING. THERE IS NOTHING ON RECORD TO SUGGEST OTHERWISE, I.E., OF THE INTEREST BEARING DEPOSITS AS OCCASSIONED BY THE ASSESSEES BUSINESS REQUIREMENTS, OF A CLEAR NEXUS WITH BUSINESS, MUCH LESS AN INTIMATE RELATIONSHIP, DENOTING ONE OF FIRST DEGREE, AS CONTEMPLATED BY LAW , WHICH THUS IS WITH THE SAID DEPOSITS. 5 .4 AS REGARDS THE REFERENCE TO THE DECISION BY THE TRIBUNAL FOR A.Y. 2000 - 01, THE LD. AR OMITTED TO REFER TO THE LAST PART OF THE RELEVANT PARA (PARA 16 OF THE TRIBUNALS ORDER / AT PB PG. 101R ), WHICH CLARIFIES THE REASON FOR T HE TRIBUNAL FOR SO CONSIDERING , I.E., IN VIEW OF THE INTER E ST INCOME BEING ADMITTED TO BE A PART OF THE ASSESSEES BUSINESS INCOME. THERE IS CLEARLY NO SUCH ADMISSION IN THE FACTS AND CIRCUM STANCES OF THE CASE, WITH IN FACT THE A.O. HAVING FOUND IT TO BE A FIT CASE FOR THE LEVY OF PENALTY, 7 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. INITIAT ING AND SUBSEQUENTLY LEV YING PENALTY ON THE CLAIM FOR DEDUCTION U/S. 10B ON THE INTEREST INCOME, SO THAT THE SAME CAN ONLY BE REGARDED AS CONTESTED. 5 .5 CONTINUING FURTHER, AS REGARDS THE DECISIONS BY THE HON'BLE J URISDICTIONAL HIGH COURT RELIED UPON, IN OUR CLEAR VIEW, THE SAME WOULD BE OF NO ASSISTANCE TO THE ASSESSEE. A S UNEQUIVOCALLY CLARIFIED IN PARAMOUNT PREMISES (P.) LTD. (SUPRA), THE DECISIO N UPHOLDING THE ASSESSMENT OF INTEREST AS BUSINESS INCOME IS BASED SQUARELY ON THE FACTUAL FINDING BY THE TRIBUNAL TO THE EFFECT THAT THE INTEREST INCOME SPRANG FROM THE BUSINESS ACTIVITY OF THE ASSESSEE - RESPONDENT, AND DID NOT ARISE OUT OF THE ANY INDEPEN DENT ACTIVITY. THERE IS CLEARLY LITTLE SCOPE FOR THE APPLICATION OF THE SAID DECISION IN THE FACTS OF THE PRESENT CASE, GIVEN THE CLEAR FINDING OF NO CONNECTION BETWEEN THE ASSESSEES BUSINESS ACTIVITY AND THE DEPOSITS YIELDING INTEREST INCOME. IN FACT, EV EN ASSESSMENT AS BUSINESS INCOME, AS OBSERVED DURING HEARING, WOULD NOT BY ITSELF SUFFICE IN - AS - MUCH AS IT WOULD REQUIRE A FURTHER SATISF ACTION OF THE CONDITION OF SECTION 10B, I.E., OF IT BEING DERIVED FROM SUCH BUSINESS, TOWARD WHICH WE FIND NO CONTENTIO N, MUCH LESS BASIS , BEING, AS APPARENT, WITH THE DEPOSITS PER SE . THE DECISION IN THE CASE OF NAGPUR ENGINEERING CO. LTD. (SUPRA) IS ONLY BY FOLLOWING THE DECISION IN PARAMOUNT PREMISES (P.) LTD. (SUPRA). IT IS WELL SETTLED THAT WHAT IS BINDING AND HAS PRE CEDENT VALUE , IS THE RATIO DECENDI OF A DECISION. THE SAID DECISION , RENDER ED FOLLOWING THE DECISION IN PARAMOUNT PREMISES (P.) LTD. (SUPRA), THUS, CANNOT BE SAID TO LAY DOWN A N Y PROPOSITION INDEPENDENT AND APART FROM THAT STATED IN PARAMOUNT PREMISES (P.) LTD. ( SUPRA), AND WHICH WE FIND AS NO DIFFERENT FROM THAT STATED BY THE HONBLE APEX COURT IN GOVINDA CHOUDHARY AND SONS (SUPRA). THAT IS, THAT IT ALL DEPENDS ON THE FACTS OF THE CASE . THE HONBLE HIGH COURT, THEREFORE, PRESUMABLY AND INFERABLY, IN THE LA TTER DECISION, I.E., NAGPUR ENGINEERING CO. LTD. (SUPRA), AGAIN FOUND A DIRECT NEXUS BETWEEN THE ASSESSEES BUSINESS AND THE INTEREST INCOME, LEADING IT TO BEING ASSESSED AS BUSINESS INCOME AND, FURTHER, OF THE SAID NEXUS AS BEING OF FIRST DEGREE, AS EXPLA INED AS FAR BACK AS IN RAJA BAHADUR KAMAKHYA NARAYAN SINGH (SUPRA), SO THAT 8 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. THE PRIMARY CONDITION OF DERIVED FROM, AS AGAINST INCIDENTAL OR ATTRIBUTABLE TO, AS IS AGAIN WELL SETTLED, STANDS SATISFIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE, AS FOUND B Y THE TRIBUNAL. THAT IS, ITS DECISION AGAIN RESTS ON THE EDIFICE OF THE FACTUAL FINDINGS BY THE TRIBUNAL, THE FINAL FACT FINDING AUTHORITY. THE SAID DECISIONS, THUS, ON THE CONTRARY, SUPPORT THE REVENUES CASE . THE FINDING BY THE TRIBUNAL IN THE INSTANT CA SE, AS APPARENT, IS OF IT BEING A FIT CASE FOR THE IMPUGNED CLAIM BEING DISALLOWED IN VIEW OF THE DECISION IN L IBERTY INDIA (SUPRA), SO THAT THERE WAS NO RELATION OF FIRST DEGREE BETWEEN THE ASSESSEES BUSINESS, WHICH IT FOUND AS QUALIFYING FOR DEDUCTION U /S.10B, AND THE INTEREST BEARING DEPOSIT/S. THE DECISION IN THE CASE OF L IBERTY INDIA (SUPRA), IT NEEDS TO BE APPRECIATED, IS ONLY IN LINE AND TANDEM WITH THE EARLIER DECISIONS , CITED SUPRA , BY THE HONBLE APEX COURT, WHICH LISTING IS AGAIN NOT EXHAUSTIVE, SO THAT THE APEX COURT DOES NOT THEREBY LAY DOWN ANY NEW LAW. RATHER, THE DECISIONS BY THE H ON'BLE J URISDICTIONAL H IGH C OURT RELIED UPON BY THE ASSESSEE ARE NOT INCONSISTENT WITH THE DECISION IN L IBERTY INDIA (SUPRA) AND, IN FACT, IN CONSONANCE WITH THE D ECISION BY THE HONBLE APEX COURT IN GOVINDA CHOUDHARY AND SONS (SUPRA). FURTHER, THE ASSESSEE ALSO HAS NOWHERE CONTESTED ANY OF THE SEVERAL DECISIONS RELIED UPON BY THE REVENUE , INCLUDING BY THE HONBLE APEX COURT AND THE JURISDICTIONAL HIGH COURT CITED S UPRA, M ANY OF WHICH ARE PRIOR TO THE DATE S OF THE FILING OF THE RETURNS IN THE INSTANT CASE, SO THAT THEY REPRESENT E D THE WELL - SETTLED /ESTABLISHED LAW OF THE LAND ; THERE BEING IN FACT A COMPLETE UNANIMITY BETWEEN THE DIFFERENT HIGH COURTS O N THE SUBJECT, I .E., BOTH WITH THE REGARD TO THE NATURE OF THE RECEIPT BY WAY OF INTEREST, AS EXPLAINED IN GOVINDA CHOUDHARY AND SONS (SUPRA), AS WELL AS QUA THE SCOPE OF THE WORD S DERIVED FROM. 5 .6 WE, IN VIEW OF THE FOREGOING, FIND NO MERIT IN THE ASSESSEES CASE. IT, TO OUR MIND, HAS NOT ADDUC ED A N Y EXPLANATION, MUCH LESS SUBSTANTIATED IT , EXCEPT FOR A BALD ASSERTION (I.E., OF THE SAID INTEREST INCOME AS BEING A PART OF THE ASSESSEES BUSINESS INCOME ) . THE RELIANCE ON THE DECISIONS BY THE HONBLE JURISDICTIONAL HIG H COURT, WHICH WE HAVE FOUND TO BE IN FACT SUPPORTIVE OF THE REVENUES CASE, WITH THE LAW IN THE MATTER BEING, IN FACT, WELL SETTLED , IS ONLY A FALSE PLEA OR A RUSE. RELIANCE ON THE DECISION BY THE TRIBUNAL FOR A 9 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. SUBSEQUENT YEAR (AY 2000 - 01) IS, UNDER THE CIRCUMSTANCES, AGAIN, COMPLETELY MISPLACED. A PLAUSIBLE EXPLANATION TOWARDS ITS CLAIM /S SAVES PENALTY U/S. 271(1)(C), IN VIEW OF, AGAIN, THE SETTLED LAW IN THE MATTER, FOR WHICH WE MAY RELY ON THE FOLLOWING DECISIONS , WHICH THOUGH IS COMPLETELY MISSING IN THE PRESENT CASE : M AK DATA (P.) LTD. V S . CIT [2013] 358 ITR 593 (SC) ; CIT V. ATUL MOHAN BINDAL [ 2009] 317 ITR 1 (SC); UNION OF INDIA V. DHARMENDRA TEXTILE PROCESSORS [ 2008] 306 ITR 277 (SC); GULJAG INDUSTRIES V. CTO [2007] 293 ITR 584 (SC) ; K.P. MADHUSU DHANAN VS. CIT [2001] 251 ITR 99 (SC); B.A. BALASUBRAMANIAM AND BROS V. CIT [ 1999 ] 236 ITR 977 (SC); ADDL. CIT VS. JEEVAN LAL SHAH [1994] 205 ITR 244 (SC); CIT VS. K. R. SADAYAPPAN [1990] 185 ITR 49 (SC); AND CIT VS. MUSSADILAL RAM BHAROSE [1987] 165 ITR 1 4 (SC) , BESIDES BY THE HONBLE HIGH COURTS AS WELL, VIZ: CIT VS. MOHD. MOHTRAM FAROOQUI [ 2003] 259 ITR 132 (RAJ) ; CIT VS. SREE KRISHNA TRADING CO. [2002] 253 ITR 645 (KER); SHIV KUMAR TAK VS. CIT [2001] 251 ITR 373 (RAJ); CIT VS. VIDYAGAURI NATVERLAL [199 9] 238 ITR 91 (GUJ) ; CIT VS. NATHULAL AGARWALA & SONS [1985] 153 ITR 292 (PAT)(FB) 6. THE ONLY OTHER GROUND IN THE ASSESSEES APPEAL S , RELATES TO THE DISALLOWANCE OF SECTION 10 - B BENEFIT ON PAYMENT TO CYBERTECH INTERNATIONAL CORPORATION LTD. (CIC LTD.) AN D ITS SUBSIDIAR IES . THE PENALTY STANDS UPHELD ON THIS EXPENDITURE AS THE CLAIM FOR DEDUCTION U/S.80 - B WAS FOUND AS NOT BONA FIDE . THE SAME WAS NOT PRESSED BEFORE US BY TH E LD. AR, SO THAT THE SAME IS DISMISSED AS NOT PRESSED. THIS DECIDES THE ASSESSEES A PPEALS FOR ALL THE YEARS. REVENUES A PPEAL S 7. THE REVENUE APPEALS RELATE TO THE RECEIPTS ON WHICH DEDUCTION U/S.10B HAS SINCE BEEN ALLOWED BY THE TRIBUNAL , AS TO UNISYS, VIDE ITS COMBINED ORDER FOR THE YEARS UNDER REFERENCE DATED 02.03.2012 (PB PGS. 1 - 4 3), I.E., AFTER RECALLING ITS EARLIER ORDER DATED 07.04.2005 DISALLOWING THE SAME (PB PGS. 44 - 101). THE ONLY PLEA ADOPTED BY THE REVENUE IS THAT IT HAVING CONTESTED THE SAID DELETION, I.E., IN THE QUANTUM 10 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. PROCEEDINGS , BEFORE THE HON'BLE J URISDICTIONAL HIGH COURT, WHICH HAS SINCE ADMITTED THE APPEALS, THE MATTER MAY BE KEPT IN ABEYANCE TILL THE DISPOSAL THEREOF BY THE HONBLE COURT. RELIANCE IS PLACED ON THE DECISION IN CIT VS. POPULAR JEWELLERS [1999] 238 ITR 676 (DEL) . WE FIND THE PLEA MISPLACED. THE ISSUE CANNOT BE KEPT UNDECIDED ONLY FOR THE REASON T HA T THE SAME IS IN APPE AL BEFORE A HIGH ER APPELLATE FORUM. HOWEVER, I N - AS - MUCH AS WE ARE DISMISSING THE REVENUES APPEAL S AT THE THRESHOLD, I.E., WITHOUT EXAMINING ON MERITS, ON WHICH NO ARGUMENT S TOOK PLACE, NOR ARE CONSIDERED NECESSARY AT THIS STAGE FOR THE REASON THAT THERE IS NO SUBSISTING GROUND FOR PENALTY ON DISALLOWANCE WHICH STANDS DELETED , WE CONSIDER IT PROPER TO ALSO PROTECT THE REVENUES INTEREST, I.E., IN THE EVENTUALITY OF THE REVENUES APPEALS B EING DECIDED IN ITS FAVOUR BY THE HONBLE COURT , REVERS ING THE DECISION BY THE TRIBUNAL. THE REVENUE SHALL IN THAT CASE BE AT LIBERTY TO PURSUE THE MATTER ON MERITS BEFORE THE TRIBUNAL, WHICH SHALL DECIDE THE SAME ON MERITS AFTER HEARING THE PARTIES. WE, A CCORDINGLY, DISMISS ITS APPEALS IN LIMINE , WHILE AT THE SAME TIME RESERVE THE SAID RIGHT TO THE REVENUE IN THE FACTS AND CIRCUMSTANCES OF THE CASE , IN THE INTEREST OF JUSTICE AND THE CONSIDERATION OF MAINTAINING A N EVEN GROUND. FURTHER, IN VIEW OF OUR HAVI NG SAVED THE SAID RIGHT, RELIANCE ON THE DECISION IN THE CASE OF POPULAR JEWELLERS (SUPRA) , WHEREIN THE HONBLE COURT ONLY FOUND THE DISMISSAL OF THE REVENUES APPEALS IN THE PENALTY PROCEEDINGS I N VIEW OF THE ASSESSEE HAVING SUCCEEDED IN THE QUANTUM PROCE EDINGS, AS JUSTIFIED, IS RENDERED OF NO CONSEQUENCE. WE DECIDE ACCORDINGLY. 8. IN THE RESULT, BOTH THE ASSESSEES AND THE R EVENUE S APPEAL S ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON AUGUST 07 , 201 5 SD/ - SD/ - (D. MANMOHAN) (SANJAY ARORA) / VICE PRESIDENT / ACCOUNTANT MEMBER MUMBAI ; DATED : 07 . 0 8 .201 5 . . ./ ROSHANI , SR. PS 11 ITA NO S . 3655 TO 3657/M / 06 & 2358 TO 2360/M / 06 (A.YS. 1997 - 98, 1998 - 99 & 1999 - 2000) CYBERTECH SYSTEMS & SOFTWARE P. LTD. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / D R, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI