The DCIT, Circle-2(1)., Vijayawada V. M/s Vignesh Enterprises, Vijayawada

ITA 337/VIZ/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7142 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 13-06-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revenue expenditure

Judgement Text

9 13. HAVING HEARD THE RIVAL SUBMISSION AND FROM A CA REFUL PERUSAL OF RECORD, WE FIND THAT UNDISPUTEDLY ASSESSEE WAS NOT INVESTOR AND HE HAS OFFERED THE INTEREST ACCRUED AND RECEIVED ON THE BONDS ON DUE D ATES TO TAX. SUCH TYPE OF SITUATIONS WHERE THE ASSESSEE PURCHASES THE BONDS F ROM A SECONDARY MARKET AND PAID THE INTEREST ACCRUED UPTO THE DATE OF PURC HASE ALONG WITH INTEREST PREMIUM TO THE SELLER, THE ASSESSEE SHOULD BE ALLOW ED TO CLAIM THESE EXPENDITURE AS A REVENUE EXPENDITURE, BECAUSE HE IS OFFERING THE INTEREST FINALLY ACCRUED ON THE BONDS ON DUE DATES TO TAX. MOREOVER, THIS SITUATION WAS EXAMINED BY DIFFERENT HIGH COURTS AND THE TRIBU NAL AT DIFFERENT POINT OF TIME AND IN ONE BREATH THEY HAVE HELD THAT WHERE TH E ASSESSEE HAS OFFERED THE INTEREST ON BONDS FOR THE BROKEN PERIOD TO TAX HE IS ENTITLED TO CLAIM THE INTEREST ACCRUED UPTO THE DATE OF PURCHASE ALONG WI TH THE INTEREST PREMIUM PAID TO THE SELLER AS REVENUE EXPENDITURE. IN THE LIGHT OF THESE LEGAL PROPOSITIONS, WE ARE OF THE VIEW THAT CIT(A) HAS CO RRECTLY ADJUDICATED THE ISSUE. SINCE WE FIND NO INFIRMITY THEREIN, WE UPHO LD THE SAME. 14. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. PRONOUNCED IN THE OPEN COURT ON 17.02.2010 SD/- SD/- (BR BASKARAN) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER VG/SPS VISAKHAPATNAM, DATED 17 TH FEBRUARY, 2010 COPY TO 1 THE DCIT, CIRCLE-2(1), VIJAYAWADA 2 M/S. VIGNESH ENTERPRISES, (HOTEL DV MANOR), 40-1- 47, M.G. ROAD, VIJAYAWADA-520 010 3 THE CIT, VIJAYAWADA 4 THE CIT(A), VIJAYAWADA 5 THE DR, ITAT, VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM