M/s Haryana State Small Industries & Export Corporation Limited, Chandigarh V. DCIT, Panchkula

ITA 8/CHANDI/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68400 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 14-08-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 03-01-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: J S NAGAR
• Keywords: Business income
• Section: 234B; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B CHANDIGARH BEFORE SHRI T.R.SOOD, ACCOUNTANT MEMBER AND MS SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO. 08/CHD/2013 ASSESSMENT YEAR:2009-10 HARYANA STATE SMALL INDUSTRIES & VS THE D Y. COMMISSIONER OF INCOME TAX, EXPORT CORPORATION LTD., PANCHKULA CIRCLE, SCO 87-88, SECTOR 17-D, PANCHKULA. CHANDIGARH. PAN NO. AAACH-4689P (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI TEJ MOHAN SINGH RESPONDENT BY : SHRI J.S.NAGAR DATE OF HEARING : 14.08.2013 DATE OF PRONOUNCEMENT : 20.08.2013 ORDER PER SUSHMA CHOWLA, J.M. THE ASSESSEE HAS FILED THE APPEAL AGAINST THE ORDER OF THE CIT(APPEALS), DATED 18.10.2012 RELATING TO ASSESSME NT YEAR 2009-10 AGAINST THE ORDER PASSED UNDER SECTION 143(3)INCOME -TAX ACT, 1961 ( 'THE ACT' FOR SHORT). 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APP EAL: 1. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED IN LAW AS WELL AS ON FACTS IN TREATING INCOME OF ASSESSEE TO BE INCOME FROM OTHER SOURCES AND NOT BUSINESS INCOME AS DECLARED RESULTING IN AN ADD ITION OF RS.66,35,1907- WHICH IS ARBITRARY AND UNJUSTIFIED. 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) HAS FURTHER ERRED IN UPHOLDING THE DISALLOWANCE OF EXPENSES CLAIMED A GAINST BUSINESS INCOME EARNED WHICH ARE ALLOWABLE AND AS SUCH THE ACTION OF THE C OMMISSIONER OF INCOME TAX (APPEALS) IS UNJUSTIFIED. 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) HAS FURTHER ERRED IN UPHOLDING THE CHARGING OF INTEREST UNDER SECTIONS 2 34-B & 234-C OF THE ACT WHICH IS NOT CHARGEABLE IN THE FACTS OF THE CASE. 2 3. THE LD. AR FOR THE ASSESSEE, AT THE OUTSET POINT ED OUT THAT THE ISSUES RAISED IN THE PRESENT APPEAL ARE DECIDED BY THE TRIBUNAL IN ASSESSEE'S OWN CASE IN THE EARLIER YEARS RELATING T O ASSESSMENT YEARS 2006-07 TO 2008-09 VIDE SEPARATE ORDERS FROM YEAR T O YEAR. THE LD. DR FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF THE TRIBUNAL PASSED IN THE CASE. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING IN THE PRESENT CASE ARE IDENTICAL TO THE ISSUES RAISED IN THE ASSESSMENT YEARS 2006-07 TO 2008-09. THE TR IBUNAL IN ITA NO. 898/CHD/2009 RELATING TO ASSESSMENT YEAR 2006-0 7 VIDE ORDER DATED 28.07.2011, IN ITA NO. 163/CHD/2011 RELATING TO ASSESSMENT YEAR 2007-08 VIDE ORDER DATED 30.08.2011 AND IN ITA NO. 1036/CHD/2011 RELATING TO ASSESSMENT YEAR 2008-09 V IDE ORDER DATED 17.10.2012 HAD ADJUDICATED THE ISSUE. THE ISSUES A RISING IN THE PRESENT APPEAL ARE IDENTICAL TO THE ISSUES ADJUDICA TED BY THE TRIBUNAL IN THE EARLIER YEARS. 5. THE ISSUE IN GROUND NOS.L AND 2 RAISED BY THE AS SESSEE IS AGAINST THE TREATMENT OF INTEREST INCOME RECEIVED B Y THE ASSESSEE AS INCOME FROM OTHER SOURCES AS AGAINST THE CLAIM OF T HE ASSESSEE THAT THE SAME IS BUSINESS INCOME. THE TRIBUNAL VIDE PARA 6 IN THE APPEAL RELATING TO ASSESSMENT YEAR 2006-07 HAD IN TURN FOL LOWING THE RATIO LAID DOWN IN THE EARLIER YEARS BY THE TRIBUNAL HAD HELD THE INTEREST INCOME TO BE ASSESSABLE AS INCOME FROM OTHER SOURCE S. HOWEVER, THE MATTER WAS REMITTED BACK TO THE FILE OF THE ASSESSI NG OFFICER FOR THE LIMITED PURPOSE OF VERIFYING THE EXPENDITURE INCURR ED IN RELATION TO EARNING OF THE SAID INCOME, TO BE ALLOWED AS A DEDU CTION. WE FIND THE HON'BLE PUNJAB & HARYANA HIGH COURT IN ASSESSEE'S O WN CASE IN M/S HARYANA STATE SMALL INDUSTRIES & EXPORT CORPORATION LTD. V CIT, 3 PANCHKULA (ITA NO. 79 OF 2012 (O&M) DATED 01.08.201 2 HAD DISMISSED THE APPEALS FILED BY DEPARTMENT HOLDING T HAT NO EXPENDITURE WAS INCURRED FOR EARNING INTEREST INCOM E. IN LINE WITH THE SAME, WE HOLD THAT THE INTEREST INCOME EARNED BY TH E ASSESSEE IS TO BE ASSESSED UNDER THE HEAD 'INCOME FROM OTHER SOURCES' AND GROUND NO.L RAISED BY THE ASSESSEE IN THIS REGARD IS THUS DISMI SSED. HOWEVER, WE DIRECT THE ASSESSING OFFICER TO VERIFY WHETHER ANY EXPENDITURE WAS INCURRED FOR EARNING OF THE SAID INTEREST INCOME AN D IF SO, THE SAME MAY BE ALLOWED IN LINE WITH THE RATIO LAID DOWN BY THE HON'BLE HIGH COURT. GROUND NO.2 RAISED BY THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. 6. THE GROUND NO. 3 RAISED BY THE ASSESSEE IS AGAIN ST CHARGING OF INTEREST UNDER SECTION 234B AND 234C OF THE ACT AND THE SAME BEING CONSEQUENTIAL, THE GROUND OF APPEAL RAISED BY THE A SSESSEE IS DISMISSED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 20 TH DAY OF AUGUST, 2013. SD/- SD/- (T.R.SOOD) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 20 TH AUGUST,2013 POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR BY ORDER ASSISTANT REGISTRAR, ITAT, CHANDIGARH