Appeal details
Counselvise Citation
81821114 RSA 2011
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 10 month(s) 17 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
02-08-2013
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
A
Next Hearing Date
03-07-2013
Assessment Year
2007-2008
Appeal Filed On
15-09-2011
Judgement Text
ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 1 OF 18 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE A BENCHES, BANGALORE BEFORE SHRI N. BARTHVAJA SANKAR, VICE PRESIDENT AND SHRI GEORGE GEORGE K. JUDICIAL MEMBER ITA NO.818/BANG/2011 (ASSESSMENT YEAR: 2007-08) KLN AGROTECHS (P) LTD, 19/4, 1 ST MAIN ROAD, JAYAMAHAL EXTENSION BANGALORE 560046 PAN: AAACK 5820 F VS. INCOME TAX OFFICER, WARD-11(2) BANGALORE (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI CHYTHANYA, K.K. ADV. DEPARTMENT BY: DR.B.S.N.PRASAD, CIT(DR-I) DATE OF HEARING: 25/07/2013 DATE OF PRONOUNCEMENT: 02/08/2013 O R D E R PER GEORGE GEORGE K. J.M. THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT A)-A BANGALORE, DATED 1.8.2011 IN RELATION TO THE ASSESSMENT YEAR 2007-08. 2. BRIEFLY STATED, THE FACTS ARE AS FOLLOWS. THE ASSESSEE IS A PRIVATE LIMITED COMPANY. IT IS E NGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF REFINED ED IBLE OIL. THE RETURN OF INCOME WAS FILED FOR THE IMPUGNED ASSESSM ENT YEAR ON 29.03.2008, DECLARING A NET LOSS OF RS.6,82,787. TH E RETURN WAS PROCESSED U/S 143(1) OF THE ACT. THE ASSESSMENT WAS TAKEN UP FOR SCRUTINY BY ISSUANCE OF NOTICE U/S 143(2) OF THE AC T. SCRUTINY ASSESSMENT ORDER WAS COMPLETED U/S 143(3) OF THE AC T VIDE ORDER DATED 30.12.2009. THE ASSESSING OFFICER DETERMINED THE TOTAL ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 2 OF 18 INCOME AT RS.2,24,79,870. THE ASSESSING OFFICER MAD E THE FOLLOWING ADDITIONS TO THE RETURNED INCOME: A) COMPUTED THE CAPITAL GAINS ON THE SALE OF FACTORY BUILDING, BOREWELL, AND PLANT & MACHINERY AFTER PRO VIDING FOR NOTIONAL DEPRECIATION FOR THE UNUSED ASSETS (UN USED SINCE 6.2.2003). B) DISALLOWING INTEREST U/S 43B TO THE EXTENT OF RS.1,93,96,881 CLAIMED BY THE ASSESSEE AS A RESULT OF ONE TIME SETTLEMENT (OTS) SCHEME OF THE BANKER. 2.1 AGGRIEVED BY THE AFORESAID ORDER PASSED U/S 143 (3) OF THE ACT, THE ASSESSEE FILED AN APPEAL BEFORE THE FI RST APPELLATE AUTHORITY. THE CIT (A) REEJECTED THE CONTENTIONS RA ISED BY THE ASSESSEE AND DISMISSED THE APPEAL PREFERRED BY THE ASSESSEE. THE ASSESSEE BEING AGGRIEVED IS IN APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APEPALS) IS NOT JUSTIFIED IN AFFIRMING THE ACTION OF THE LEARNED ASSESSING OFFICER IN COMPUTING THE NOTIONAL DEPRECIATION WHILE DETERMINING CAPITAL GAINS U/S 50 BY FAILING TO APPRECIATE THAT THE IMPUGNED ASSETS WERE SEIZED BY THE BANK TOWARDS RECOVERY OF LOAN AS EARLY AS IN 2003 AND SAME WERE NOT PUT TO USE BY THE APPELLANT FROM THE ASSESSMENT YEAR 2003-04 ONWARDS. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APEPALS) OUGHT NOT TO HAVE DIALLOWED A SUM OF RS.1,93,96,881 CLAIMED BY THE APPELLANT U/S 43B ON THE BASIS THAT THE ONE TIME SETTLEMENT OF LOAN WAS TOWARDS INTEREST, PARTICULARLY WHEN THE DEPARTMENT ACCEPTED THE TREATMENT OF APPELLANT IN ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 3 OF 18 OFFERING THE PRINCIPAL AMOUNT OF LOAN TO TAX TO THE EXTENT OF RS.2,57,08,826 ON THE BASIS THAT THE SAME WAS WAIVED. 3. IN THE ALTERNATIVE AND WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS NOT JUSTIFIED IN FAILING TO APPRECIATE THAT THE PRINCIPAL AMOUNT OF LOAN TO THE EXTENT OF RS.2,57,08,826 OFFERED TO TAX BY THE APPELLANT ON MISUNDERSTANDING OF FACT AND LAW, HAD TO BE NECESSARILY EXCLUDED IN COMPUTING THE TOTAL INCOME IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. 3. CAPITAL GAINS (GROUND NO.1): BRIEF FACTS IN RELATION TO THE ABOVE GROUND ARE FOL LOWS: THE ASSESSEE HAD SOLD THE LAND, FACTORY BUILDING, B ORE WELL AND PLANT & MACHINERY AND DECLARED A CAPITAL GAINS TO T HE EXTENT OF RS.1,19,90,389 IN RESPECT THEREOF. THE COMPUTATION OF CAPITAL GAINS IS AS FOLLOWS: AMOUNT IN RS. NATURE OF THE ASSET SALE CONSIDERATION (A) INDEXED/ COST OF ACQUISITION WDV AS ON 31.03.03 (B) GAIN (A)-(B) LAND 1,73,78,117 60,13,148 1,13,64,969 FACTORY BUILDING 49,12,452 49,12,452 NIL BORE WELL 81,431 80,431 1,000 PLANT & MACHINERY 44,92,785 38,68,365 6,24,420 TOTAL GAIN 1,19,90,389 3.1 WHILE COMPUTING THE CAPITAL GAINS, THE ASSESSEE HAD ADOPTED W.D.V. OF THE ASSET AS ON 31.03.2003 SINCE THE PROP ERTY IN QUESTION WERE ATTACHED/SEIZED FOR DEFAULT IN PAYMENT OF LOAN BORROWED FROM ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 4 OF 18 CANARA BANK AND THE STATE BANK OF INDIA. THE DEPREC IATION ON THE ABOVE SAID ASSETS WERE NOT CLAIMED SINCE 2003 BY TH E ASSESSEE AS IT WAS NOT USED IN THE ASSESSEES BUSINESS AND THEREFO RE ACCORDING TO ASSESSEE THE CONDITIONS MANDATED U/S 32 OF THE ACT WAS NOT FULFILLED. 3.2 IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HELD BY VIRTUE OF EXPLANATION 5 TO SECTION 32 OF THE ACT, NOTIONAL DEPRECIATION WAS TO BE GRANTED TO THE ASSESSEE FROM 2003 ONWARDS AND THE WDV OF THE PROPERTY AS ON 31.03.2006 IS TO BE CALCULATED A FTER GRANTING NOTIONAL DEPRECIATION FROM THE YEAR 2003. ACCORDING LY, THE ASSESSING OFFICER ARRIVED AT THE CAPITAL GAINS AT R S.1,57,56,169 AS AGAINST RS.1,19,90,389 ADMITTED BY THE ASSESSEE. 3.3 AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEF ORE THE CIT (A). THE CIT (A) DISMISSED THE CONTENTIONS RAISED BY THE ASSESSEE. THE RELEVANT FINDINGS OF THE CIT (A) ARE AS FOLLOWS: 7. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE NO RMAL COMMONSENSE AS WELL AS PRINCIPLES OF LAW STATE THAT THERE NO OBLIGATION TO GIVE OR ALLOW SOMETHING WHE N THE SAME IS NOT ASKED FOR AS IN THIS CASE THE APPELLANT HAS NOT ASKED FOR THE DEPRECIATION CLAIM. BUT HERE IS A N EXCEPTION. EXPLANATION 5 TO SECTION 32 WHICH CLARIF IES THAT DEPRECIATION HAS TO BE MANDATORILY ALLOWED WHETHER THE SAME HAD BEEN CLAIMED BY THE ASSESSEE O R NOT. BUT BEFORE SUCH ALLOWANCE, THE ASSESSING OFFIC ER IS DUTY BOUND TO EXAMINE THE FACTS OF EACH CASE AND GI VE A FINDING THAT THE ASSESSEE IS ELIGIBLE FOR SUCH CLAI M I.E. OTHER CONDITIONS HAVE BEEN FULFILLED. TO CLAIM DEPRECIATION U/S 32 OF I.T. ACT, TWO CONDITIONS MUS T BE FULFILLED. THE FIRST ONE IS THAT THE ASSESSEE MUST BY THE OWNER OF THE ASSET AND SECONDLY SUCH ASSET MUST HAV E BEEN USED FOR THE PURPOSE OF BUSINESS. THE ADMITTED FACTS OF THIS CASE IS THAT THE SOLD ASSETS VIZ., BU ILDING, BORE WELL AND PLANT AND MACHINERY HAD NOT BEEN USED ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 5 OF 18 SINCE 01-04-2003 FOR THE PURPOSE OF BUSINESS OF PRODUCTION OF REFINED OIL. THUS ONE OF THE BASIC CONDITIONS FOR ALLOWANCE OF DEPRECIATION RELIEF IS MISSING. EXPLANATION ONLY CLARIFIES THE BASIC PROVI SIONS OF A SUBSTANTIVE SECTION AND CANNOT ACT AS SUBSTITU TE. THEREFORE, FOLLOWING THE RATIO OF THE JURISDICTIONA L HIGH COURT IN THE CASE OF DCIT VS. YELLAMMA DASAPPA HOSPITAL (2007) 290 ITR 353 (KAR), IT IS HELD THAT THE ASSESSEE IS JUSTIFIED TO CONSIDER THE COST OF THE S OLD ASSETS AS THE W.D.V. AS ON 01.04.2003 AS PER LAW. B UT THE COMPUTATION OF STCG ON SALE OF SUCH CAPITAL ASS ETS IS NOT DEPENDENT ON THE REDUCTION OF DEPRECIATION A S PER THE PROVISIONS OF SECTION 32(1) OF I.T. ACT. EVEN S TANDING UNUSED MACHINERIES GET RUSTED AND ITS VALUE DEPRECIATES EVEN AT THE RATE SOMETIMES MORE THAN TH AT PRESCRIBED IN THE APPENDIX 1 UNDER RULE 5 TO I.T. R ULES 1962 BUT NORMALLY SUCH RATE IS FOLLOWED AS A MODEL. THE ASSESSING OFFICER HAD DONE SO UNKNOWINGLY IN THE GU ISE OF EXPLANATION 5 TO SECTION 32 OF THE I.T. ACT. THE REFORE, THOUGH ON LAW I AGREE WITH THE AR THAT THE ASSESSEE IS NOT ENTITLED FOR DEPRECIATION ON PLANT AND MACHINER Y, BORE WELL AND FACTORY BUILDING ON FACTS OF THE CASE BY APPLICATION OF COMMONSENSE, I HOLD THE ASSESSING OFFICER IS JUSTIFIED TO TREAT THE COST AS THE WDV A S ON 01- 04-2006. HENCE THE COMPUTATION OF CAPITAL GAINS IS HELD CORRECT AND JUSTIFIED. 3.4 THE ASSESSEE BEING AGGRIEVED, IS IN APPEAL BEFO RE US. THE LEARNED COUNSEL REITERATED THE SUBMISSIONS MADE BEF ORE THE INCOME TAX AUTHORITIES. ON THE OTHER HAND, THE LEARNED DR SUPPORTED THE REASONING AND CONCLUSIONS OF BOTH THE ASSESSING OFF ICER AND THE CIT (A). 3.5 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSETS OF THE ASSESSEE BEING FACTORY BUILDING, BORE WELL AND PLAN T AND MACHINERY WERE SEIZED BY CANARA BANK AND THE STATE BANK OF IN DIA (ON 06.02.2003) AS A RESULT OF DEFAULT IN THE REPAYMENT OF THE LOANS TO THE RESPECTIVE BANKS UNDER THE SARFAESI ACT AND THE MATTER WAS ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 6 OF 18 SUBJECTED TO DRT. THE ASSET OF THE ASSESSEE BEING L AND WAS SEIZED BY CANARA BANK VIDE POSSESSION NOTICE DATED 05.02 .2003, AS A RESULT OF DEFAULT IN THE REPAYMENT OF THE LOANS TO THE RESPECTIVE BANKS UNDER THE SARFAESI ACT AND THE MATTER WAS SUB JECTED TO DRT. THEREFORE, THE ASSESSEE WAS NOT IN POSSESSION AND CONTROL OF THE ASSETS DUE TO THE SEIZURE AS AFORESAID SO AS TO USE THEM FOR THE CONDUCT OF THE BUSINESS. THERE WAS NEITHER ACTIVE N OR PASSIVE USE OF THE SAID ASSETS AS THEY REMAIN SEIZED BY THE BANKS. THE ASSETS WERE AUCTIONED BY THE BANKS TO THE BEST BIDDER AND THE A SSETS WERE DIRECTLY HANDED OVER BY THE BANK TO THE BUYER. 3.5.1 IN ORDER TO CLAIM DEPRECIATION, THE ASSESSEE NEEDS TO SATISFY THE CONDITIONS AS STIPULATED U/S 32(1) OF THE ACT. THE RELEVANT PORTION OF THE SECTION READ AS FOLLOWS: SECTION 32(1): IN RESPECT OF DEPRECIATION OF- (I) BUILDINGS, MACHINERY, PLANT OR FURNITURE, BEING TANGIBLE ASSETS; (II) KNOW-HOW, PATENTS, COPYRIGHTS, TRADE MARKS, LICENSES, FRANCHISES OR ANY OTHER BUSINESS OR COMMERCIAL RIGHTS OF SIMILAR NATURE, BEING INTANGIBLE ASSETS ACQUIRED ON OR AFTER THE 1 ST DAY OF APRIL, 1998. OWNED, WHOLLY OR PARTLY, BY THE ASSESSEE AND USED FOR THE PURPOSE OF THE BUSINESS OR PROFESSION, THE FOLL OWING DEDUCTIONS SHALL BE ALLOWED. 3.5.2 FROM A PLAIN READING OF THE SECTION, IT IS E VIDENT THAT IN ORDER TO CLAIM DEPRECIATION U/S 32 OF THE ACT, THE ASSESS EE MUST BE OWNING THE ASSETS AND THE SAME SHOULD BE USED FOR T HE PURPOSE OF THE BUSINESS. IN THE CASE OF TAMIL NADU CIVIL SUPPL IES CORPORATION LTD V. CIT (1997) 228 ITR 399 (MAD)/(1999) 139 CTR 89/(1989) 26 TAXMAN 463 IT HAS BEEN HELD THAT ONE OF THE CONDITI ONS PRECEDENT ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 7 OF 18 FOR CLAIMING DEPRECIATION IS THAT THE ASSESSEE MUST BE THE OWNER OF THE ASSET ON WHICH DEPRECIATION IS CLAIMED. IN THE SAID CASE THE RICE MILLS BELONGING TO THE COOPERATIVE SOCIETIES WERE T AKEN OVER BY THE GOVT. IN 1972 AND SALE DEEDS WERE EXECUTED IN 1978. IN THE LIGHT OF SUCH FACTS IT WAS HELD THAT THE ASSESSEE CORPORATIO N WAS NOT THE LEGAL OWNER OF THE ASSETS UNDER CONSIDERATION. THER EFORE, THE ASSESSEE WAS NOT ENTITLED TO DEPRECIATION AND DEVEL OPMENT REBATE FOR THE ASSESSMENT YEAR 1973-74 AND 1974-75. THE AF ORESAID JUDGMENT OF THE HIGH COURT WAS UPHELD BY THE APEX C OURT IN THE CASE OF TAMIL NADU CIVIL SUPPLIES CORPORATION LTD V . CIT (2001) 249 IR 214 (SC) (1998) 96 TAXMAN 463/(1997) 139 CTR 89. IN THE PRESENT CASE THE ASSESSEE TOO IS ON A SIMILAR FOOTI NG AS IN THE CASE OF TAMIL NADU CIVIL SUPPLIES (SUPRA), IN SO FAR AS THE ASSETS HAVING BEEN TAKEN OVER BY THE CANARA BANK VIDE THE POSSES SION NOTICE DATED 05.02.2003. THE ASSESSEE WHO COULD NOT EXERC ISE ANY CONTROL OF OWNERSHIP COULD NOT BE CALLED AS THE OWNER AND C OULD NOT BE SAID TO HAVE USED THE SAID ASSET SO AS TO CLAIM DEPRECIA TION IN RESPECT THEREOF. 3.5.3 AS MENTIONED ABOVE, THE OTHER CONDITION, IN ORDER TO CLAIM DEPRECIATION, IS THAT THE ASSET MUST HAVE BEEN USED FOR THE PURPOSES OF THE ASSESSEES BUSINESS. IN THIS CONTEX T THE GUJARAT HIGH COURT IN THE CASE OF SUHRID GEIGY LTD (1982) 1 33 ITR 884 (GUJ.)(1981) 25 CTR 280 (1981) 7 TAXMAN 183 HELD TH AT DEPRECIATION CAN BE CLAIMED ONLY BY ACTUAL USER FOR BUSINESS. DEPRECIATION IS INSEPARABLE FROM THE ACTUAL USER FO R BUSINESS AND DEPRECIATION ALLOWANCE IS PERMISSIBLE ONLY ON THAT ACCOUNT. IT IS NOT AN ALLOWANCE FOR NATURAL WEAR AND TEAR BY REASON OF THE AGING PROCESS. EVERY BUILDING STARTS AGING FROM THE DAY I T IS CONSTRUCTED, BUT DEPRECIATION IS CLAIMABLE ONLY ON ACCOUNT OF IT S USER FOR BUSINESS WHICH CAN RESULT IN PROFITS AND GAINS. IN SECTION 32 THE ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 8 OF 18 EMPHASIS IS ON THE USER OF THE ASSET IN THE BUSINES S OF THE ASSESSEE. THERE MUST BE ACTUAL, EFFECTIVE AND REAL USER IN TH E COMMERCIAL SENSE AND THE USER IN THE COMMERCIAL SENSE AND THE USER MUST BE SO LINKED WITH THE BUSINESS THAT IT CAN BE SAID THA T THERE IS AN IMMEDIATE NEXUS BETWEEN THE USER AND THE BUSINESS, I.E. THE REAL BUSINESS OF THE ASSESSEE. THE AFORESAID RULING OF T HE GUJARAT HIGH COURT EFFECTIVELY COUNTERS THE STANCE OF THE LEARNE D CIT (A) THAT DEPRECIATION WOULD NEED TO BE PROVIDED EVEN FOR NAT URAL WEAR AND TEAR. 3.5.4 ON THE ASPECT OF USAGE IS CONCERNED, THE RE IS A NUMBER OF CASE LAW WHICH HAS HELD THAT THE TERM NEE DS TO BE UNDERSTOOD IN A WIDER SENSE AND EVEN PASSIVE USE WOULD BE CONSIDERED. FOR THE PURPOSE OF PASSIVE USE IT HAS BEEN HELD THAT EVEN THE ASPECT OF WHERE THE ASSETS ARE KEPT READY FOR USE, THE SAME WOULD BE CONSIDERED AS USAGE. THE ASSESSEE NOT BEING IN POSSESSION OF THE ASSETS, IT CANNOT BE SAID THE SEI ZED ASSETS WERE KEPT IN A STATE OF READINESS. 3.5.5 SECTION 50 CONTAINS SPECIAL PROVISIONS FOR C OMPUTATION OF CAPITAL GAINS IN THE CASE OF DEPRECIABLE ASSETS. THE SAID SECTION NOWHERE PROVIDES THAT CERTAIN DEEMED DEPRECIATION N EEDS TO BE ALLOWED. SECTION 50 MERELY STATES WHERE DEPRECIATI ON HAS BEEN ACTUALLY ALLOWED UNDER THIS ACT. THE SAME, THEREFO RE, IMPLIES THAT WHERE THE DEPRECIATION HAS BEEN ALLOWED AS PER THE PROVISIONS OF THE ACT AFTER THE FULFILLING CONDITIONS PRESCRIBED U/S 32 OF THE ACT AND THEN THE SPECIAL PROVISIONS OF SECTION 50 WOULD FOL LOW. 3.5.6 FOR THE AFORESAID REASONS, WE ARE OF THE VIE W THAT THE ORDER OF THE CIT (A) CONFIRMING THE ASSESSMENT ORDE R IN RESPECT OF ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 9 OF 18 COMPUTATION OF CAPITAL GAIN IS NOT CORRECT. THEREFO RE, WE DIRECT THAT GRANT OF NOTIONAL DEPRECIATION FROM THE YEAR 2003 F OR CALCULATION OF WDV AS ON 01.04.2006 IS NOT WARRANTED. HENCE, WE CO NFIRM THE COMPUTATION OF CAPITAL GAINS MADE BY THE ASSESSEE U /S 50 OF THE ACT. IT IS ORDERED ACCORDINGLY. 3.6. IN THE RESULT, GROUND NO.1 RAISED BY THE ASSES SEE IS ALLOWED. DISALLOWANCE U/S 43B OF THE ACT (GROUND NO.2 & 3): 4. THE ASSESSEE HAD CLAIMED DEDUCTION U/S 43B OF TH E ACT FOR THE ALLEGED PAYMENT OF INTEREST OF RS.1.93 CRORES. HOWEVER, THE AO, AFTER QUOTING COLUMN NO.21 OF 3 CD FURNISHED BY THE ASSESSEE, TOOK A VIEW THAT THE ASSESSEE HAD NOT PAID ANY INTEREST DURING THE YEAR AND THEREFORE ADDED THE INTEREST CLAIMED AS DEDUCTI ON. THE OBSERVATIONS OF THE ASSESSING OFFICER READ AS FOLLO WS: 10THE ASSESSEE COMPANY HAS NEITHER SHOWN THE PAYMENT MADE DETAILS AS REQUIRED IN FORM 3CD, I N RESPECT OF THE SAID AMOUNT I.E., INTEREST PAYMENT O F RS.1,93,96,881/-NOR PRODUCED ANY EVIDENCE FOR SUCH PAYMENTS MADE IN PREVIOUS YEAR 2006-07 RELEVANT TO ASST. YEAR 2007-08 EVEN DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THEREFORE, INTEREST CLAIME D U/S 43B OF I T ACT IS DISALLOWED. 4.1 AGGRIEVED BY THE ADDITION MADE BY THE AO, THE A SSESSEE PREFERRED AN APPEAL BEFORE THE CIT (A). THE ASSESSE E ALSO RAISED ADDITIONAL GROUNDS WHICH READ AS FOLLOWS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED ASSESSING OFFICER OUGHT TO HAVE EXCLUDED THE PRINCIPAL AMOUNT OF LOAN WAIVED WHICH WAS WRONGLY OFFERED IN THE TOTAL INCOME BY THE APPELLANT. ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 10 OF 18 2. THE LEARNED ASSESSING OFFICER OUGHT TO HAVE APPRECIATED THAT WAIVER OF PRINCIPAL AMOUNT OF LOAN CANNOT CONSTITUTE INCOME EITHER U/S 28 OR 41(1) OF THE ACT AND ACCORDINGLY NOT INCLUDIBLE IN THE TOTAL INCOME FOR TAXATION. 4.2. THE CIT (A) TURNED DOWN THE ASSESSEES PLEA O N THE PREMISE THAT THE ASSESSEE HAD NOT PAID THE INTEREST LIABILI TY BECAUSE THE SAME WAS WAIVED BY THE BANK AND, HENCE, THE INTERES T HAS TO BE DISALLOWED FOR THE AY 2008-09 AS THE SAME WAS NOT P AID. MOREOVER, ACCORDING TO THE CIT (A), THE FORM NO.3CD OF THE AS SESSEE ALSO STATES THAT NO INTEREST HAS BEEN PAID DURING THE YE AR. HENCE, THE SAID INTERESTS CLAIM WAS CORRECTLY DISALLOWED US/ 43B OF THE ACT. THE RELEVANT FINDINGS OF THE CIT (A) READ AS FOLLOW S: 9.. IN GIST, THE ASSESSEE HAS STATED THAT HE HAS MADE ONE-TIME SETTLEMENT OF RS.3,78,72,000/- AS AGAINST TOTAL DUES OF RS.6,65,26,962/- (SIC) RS.6,35,26,962/-. FURTHER, THE ASSESSEE STATED THAT THERE IS A WAIVER OF INTEREST OF RS.260.77 LAKHS AND HAS PLEADED THAT WHEN THE INTEREST LIABILITY HAS BEEN WAIVED THERE IS NO REQUIREMENT OF ADDITION U/S 41(1). THE ASSESSEES CONTENTION IS NOT CORRECT. THE ASSESSEE HAS NOT PA ID THE INTEREST LIABILITY BECAUSE THE SAME IS WAIVED B Y THE BANK. HENCE, THE INTEREST HAS TO BE DISALLOWED FOR THE ASST. YEAR 2008-09 AS THE SAME IS NOT PAID. THE PROVISIONS OF SECTION 43B ARE VERY CLEAR IN RESPECT OF THE ISSUE. ACCORDING TO SECTION 43B, THE DEDUCTION OTHERWISE ALLOWABLE IN RESPECT OF ANY SUM PAYABLE B Y THE ASSESSEE AS INTEREST ON ANY LOAN OR BORROWING F ROM A SCHEDULED BANK SHALL BE ALLOWED IN COMPUTING THE INCOME REFERRED TO IN SECTION 28 OF THAT PREVIOUS Y EAR IN WHICH SUCH SUM IS ACTUALLY PAID BY HIM. IN THE INS TANT CASE, NO INTEREST IS PAID BY THE ASSESSEE. HENCE, I T GOES WITHOUT SAYING THAT INTEREST HAS TO BE DISALLOWED U /S 43B. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, THE ASSESSEES CONTENTION IS NOT ACCEPTABLE. THE FORM 3CD FILED BY THE ASSESSEE COMPANY ALSO STATES THAT NO INTEREST HAS BEEN PAID DURING THE YEAR. HENCE, THE SAID INTEREST IS CORRECTLY DISALLOWED U/S 43B. ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 11 OF 18 4.2.1 WITH REFERENCE TO THE ADDITIONAL GROUNDS RA ISED, THE CIT (A)DISMISSED THE CONTENTIONS THEREIN BY OBSERVING T HUS: 10.1 FOR THIS GROUND IT IS OBSERVED THAT THE APPEL LANT HAS ITSELF OFFERED THE SAID SUM TO TAX IN THE RETUR N OF INCOME. THIS IS NEITHER AN ADDITION NOR DISALLOWANC E MADE BY THE ASSESSING OFFICER. HENCE, NO CAUSE OF ACTION ARISES IN RESPECT OF THIS ISSUE. HENCE, ASSE SSEES CONTENTION IS LIABLE TO BE DISMISSED. ADDITIONAL GR OUND OF APPEAL IS DISMISSED. 4.3. THE ASSESSEE BEING AGGRIEVED BY THE ORDER OF T HE CIT (A) IS IN APPEAL BEFORE US. THE CONTENTIONS RAISED BY THE ASS ESSEE ARE SUMMARIZED AS FOLLOWS: - THAT THE DISALLOWANCE OF INTEREST AMOUNT OF RS.1.93 CRORES REPRESENTS THE INTEREST RECOVERED BY THE BANK OUT O F THE SALE PROCEEDS ON TERM LOAN OF RS.3.87 CRORES AND ON WORK ING CAPITAL. THIS INTEREST WAS PROVIDED IN THE BOOKS I N THE EARLIER YEARS, BUT, DISALLOWED U/S 43B ON ACCOUNT OF NON-PA YMENT; AND THAT THERE WAS AN ONE TIME SETTLEMENT (OTS) AGR EED UPON BETWEEN CANARA BANK AND THE ASSESSEE AS A RESULT OF WHICH, THE ASSESSEE HAD MADE A PAYMENT OF RS.3.78 CRORES A S AGAINST THE TOTAL LIABILITY, INCLUSIVE OF INTEREST OF RS.6, 35,26,962/-; - EXTENSIVELY QUOTING THE PROVISIONS OF S. 43B OF T HE ACT, IT WAS CONTENDED THAT AS IS EVIDENT FROM THE PLAIN READING OF THE SECTION, ANY SUM PAYABLE AS INTEREST ON LOAN ADVAN CED BY A SCHEDULED BANK SHALL BE ALLOWED AS A DEDUCTION IN T HE YEAR WHEN THE LIABILITY HAS BEEN DISCHARGED; THAT IN TH E PRESENT CASE, THE BANK HAVING RECOVERED THE SAID INTEREST B Y WAY OF SALE OF ASSETS OF THE ASSESSEE, THE SAID LIABILITY IN EF FECT HAS BEEN DISCHARGED DURING THE RELEVANT ASSESSMENT YEAR AND, THEREFORE, THE DEDUCTION IN RESPECT OF THE INTEREST PAID NEEDS TO BE NECESSARILY ALLOWED U/S 43B. THE FACT THAT THE SAI D AMOUNT WAS RECOVERED BY THE BANK BY THE SALE OF THE ASSESS EES ASSETS DOES NOT IN ANY MANNER AFFECT THE ASPECT OF PAYMEN T. IN EFFECT, IT REMAINS A PAYMENT MADE BY THE ASSESSEE T O THE BANK; - THAT THE BREAK-UP OF THE AMOUNTS OWED TO CANARA BAN K AS ON 31.3.2006 WAS AS FOLLOWS: ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 12 OF 18 NATURE OF LIABILITY RS RS. LOAN: A. TERM LOAN TO CANARA BANK 3,87,82,000 B. WORKING CAPITAL LOAN FROM CANARA BANK 53,48,081 C. INTEREST ACCRUED AND DUE 1,11,74,019 D. FUNDED INTEREST 82,22,862 1,93,96,881 - THAT THE ASSESSEE ORIGINALLY UNDERSTOOD THE APPR OPRIATION OF OTS OF RS.3,78,72,000/- AS UNDER: A. ENTIRE AMOUNT OF OTS RS,3,78,72,000 B. TOWARDS SETTLEMENT OF INTEREST BOOKED (AS PER TABLE ABOVE) RS.1,93,96,881 C. BALANCE TOWARDS PRINCIPAL REPAYMENT RS.1,84,75,119 - THAT ON THE ABOVE BASIS, THE ASSESSEE HAD PASSED THE ENTRIES IN ITS BOOKS AND THEREBY CONSIDERED RS.2,57,08,826/ - AS LOAN WRITTEN BACK ON THE: - THAT THE AFORESAID OTS WAS EVIDENT FROM THE LETT ER OF CANARA BANK DATED 10.8.2006 AND ALSO CONFIRMATION LETTER D ATED 31.12.2009 FROM THE SAID BANK AND THAT THE BANK HA D ACCEPTED THE OTS OF RS.3,78,72,000/- WHILE WRITING OFF OF THE PARTICULARS RS. RS. A. TERM LOAN FROM CANARA BANK B. WORKING CAPITAL LOAN FROM CANARA BANK TOTAL LOAN C. LESS: AMOUNT TOWARDS PRINCIPAL REPAYMENT (AS PER THE ABOVE TABLE D. BALANCE OF LOAN UNDERSTOOD AS WAIVED BY THE BANK E. AMOUNT SHOWN AS WRITTEN BACK IN THE BOOKS F. EXCESS OFFERED BY THE ASSESSEE [25708826 25654962] 3,87,82,000 53,48,081 4,41,30,081 1,84,75,119 2,56,54,962 2,57,08,826 53,864 ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 13 OF 18 BOOK LIABILITY OF RS.1,96,30,000/- AND THAT THE SAI D LETTER FURTHER ALSO REFERRED TO THE WAIVER OF THE BALANCE UNAPPLIED INTEREST TO THE EXTENT OF RS.260.77 LAKHS WHICH EXH IBITS THAT THE RECOVERY WAS TOWARDS PRINCIPAL OF LOAN RELIES ON THE RULING OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF VINIR ENGINEERING P. LTD V. DCIT (2009) 313 ITR 154 (KAR) . - THAT IN THE ABOVE SAID CASE, THE HONBLE COURT ( SUPRA) RECOGNIZED THE CONVERSION OF INTEREST TO LOAN ITSEL F AS PAYMENT OF INTEREST; 4.3.1. IN CONCLUSION, IT WAS CONTENDED THAT THE INTEREST DISCHARGED BY THE ASSESSEE TO THE EXTENT OF RS.1,93 ,96,881/- HAS TO BE ALLOWED AS A DEDUCTION U/S 43B OF THE ACT. REGARDING EXCLUSION OF PRINCIPAL AMOUNT OF RS.2.57 CRORES WRONGLY CREDITED IN THE BOOKS WHILE COMPUTING THE T OTAL INCOME (GROUND NO.3): - THAT THE ASSESSEE UNDERSTOOD THE OTS OF RS.378.72 LAKHS AS BEING FIRST ATTRIBUTED TOWARDS INTEREST AND BALA NCE TOWARDS PRINCIPAL LEAVING A PORTION OF PRINCIPAL UNPAID AND WAIVED AND THAT ON THIS BASIS, THE ASSESSEE HAD CLAIMED INTERE ST DEDUCTION U/S 43B AND OFFERED, ALTHOUGH, WRONGLY, T HE WAIVED PRINCIPAL TO TAX; - THAT THE OTS OF RS.378.72 LAKHS AS BEING FIRST AT TRIBUTED TOWARDS PRINCIPAL AND BALANCE TOWARDS INTEREST, IT MAY MEAN THAT UNPAID INTEREST OF RS.1,93,96,881/- IS DISQUAL IFIED FOR DEDUCTION U/S 43B. HOWEVER, THIS WOULD ALSO MEAN T HAT THERE IS NO WAIVER OF PRINCIPAL AMOUNT. THIS WILL RENDER THE OFFER OF WAIVED PRINCIPAL SUM OF RS.2.57 CRORES MAD E BY THE ASSESSEE ERRONEOUS. (REFER: CANARA BANKS LETTER DT.31.12.2009); - THAT THE ERRONEOUS OFFER OF TAX OF RS.2.57 CRORES TOWARDS WAIVER OF PRINCIPAL SUM IS MORE THAN THE ERRONEOUS CLAIM OF INTEREST U/S 43B OF RS.1,93,96,881/-. AS BOTH ERRO NEOUS OFFER OF WAIVED PRINCIPAL SUM TO TAX AND ERRONEOUS CLAIM OF INTEREST U/S 43B EMANATED FROM A SINGLE TRANSACTION /EVENT I.E. OTS, BOTH SHOULD BE UNDERSTOOD TO HAVE CANCELL ED EACH OTHER. IN OTHER WORDS, WHICHEVER WAY THE APPROPRI ATION OF OTS IS UNDERSTOOD, THE ASSESSEE CANNOT BE PUT TO INCONVENIENCE, I.E., TAX ON WAIVED PRINCIPAL SUM A S WELL AS DISALLOWANCE OF INTEREST U/S 43B; ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 14 OF 18 - RELIES ON THE CASE OF SABNIS ASHOK ANANT V. ACIT (2008 )117 TTJ (PUNE)96; - IF OTS WAS TO FIRST APPROPRIATED TOWARDS INTEREST AND THEN TOWARDS PRINCIPAL , THE FOLLOWING TABLE REFLECTS THE TAX TREATMENT, NAMELY: A. ENTIRE AMOUNT OF OTS RS. 3,78,72,000 B. TOWARDS SETTLEMENT OF INTEREST BOOKED RS.1,93,96,881 C.BALANCE TOWARDS PRINCIPAL REPAYMENT RS.1,84,75,119 D WAIVED PRINCIPAL SUM RS.2,56,54,965 - THAT IF THE OTS WERE TO FIRST APPROPRIATED TOWA RDS PRINCIPAL AND THEN TOWARDS INTEREST, THE FOLLOWING TABLE REFLECTS THE TAX TREATMENT, NAMELY: A. ENTIRE AMOUNT OF OTS RS.3,78,72,000 B. TOWARDS PRINCIPAL RS.3,78,72,000 C. BALANCE TOWARDS INTEREST RS. NIL D. UNPAID INTEREST RS.1,93,96,881 E. WAIVED PRINCIPAL SUM RS.62,58,081 - THAT (WITHOUT PREJUDICE TO THE ABOVE) THE PRINCIP AL AMOUNT OF LOAN WAIVED WHICH WAS OFFERED TO TAX WAS A RESULT O F THE MISUNDERSTANDING OF FACT AND THE SAME BE EXCLUDED FOR THE PURPOSE OF COMPUTATION OF THE INCOME, AND THAT THE CIT (A), INSTEAD OF DECIDING THE ISSUE ON MERITS, DISMISSED THE SAME ON THE BASIS OF THE ASSESSEES ADMISSION; - THAT THERE CANNOT BE AN ESTOPPEL AGAINST AN ASSES SEE IN A CASE WHERE AN AMOUNT HAS BEEN ERRONEOUSLY OFFERED F OR TAXATION BEING NOT IN LINES WITH THE PROVISIONS OF LAW, THAT EXPLICITLY WHERE AN AMOUNT CANNOT BE TAXED UNDER TH E LAW, BUT, THE SAME HAS BEEN OFFERED TO TAX BY THE ASSESS EE INADVERTENTLY, THE SAME CANNOT BE TAXED ON THE PREM ISE OF ESTOPPEL AGAINST THE ASSESSEE; - RELIES ON THE FOLLOWING CASE LAWS : (I) BHANDARI METALS AND ALLOYS (P) LTD V. STATE OF KARNATAKA (2004) 146 ITR 292 (KAR); (II) CCE (APPEALS) V. KVR CONSTRUCTION (2012) 50 VST 469 (KAR); (III) CIT V. C. PARAKH AND COK (INDIA) LTD (1956) 29 ITR 661 (SC); ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 15 OF 18 (IV) PULLANGODE RUBBER PRODUCE CO. LTD V. STATE OF KERAL A 91 ITR 18 (SC); (V) CIT V. BHARAT GENERAL REINSURANCE CO. LTD (1971) 81 ITR 303 (DEL); (VI) BOARDS CIRCULAR NO.14(XL-35/1955 DATED: 11.4.1955 - EXTENSIVELY QUOTING THE PROVISIONS OF S. 41 (1) O F THE ACT, IT WAS SUBMITTED THAT THE FOLLOWING POINTS ARE TO BE K EPT IN VIEW: (I) IN THE COURSE OF ASSESSMENT FOR AN EARLIER YEAR, ALLOWANCE OR DEDUCTION HAS BEEN MADE IN RESPECT OF TRADING LIABILITY INCURRED BY THE ASSESSEE; (II) SUBSEQUENTLY, A BENEFIT IS OBTAINED IN RESPECT OF SUCH TRADING LIABILITY BY WAY OF REMISSION OR CESSATION THEREOF DURING THE YEAR IN WHICH SUCH EVENT OCCURRED; (III) IN THAT SITUATION, THE VALUE OF THE BENEFIT ACCRUIN G TO THE ASSESSEE IS DEEMED TO BE THE PROFIT AND GAINS O F BUSINESS WHICH OTHERWISE WOULD NOT BE HIS INCOME; & (IV) SUCH VALUE OF THE BENEFIT IS MADE CHARGEABLE TO INCOME-TAX AS THE INCOME OF THE PREVIOUS YEAR IN WHICH SUCH BENEFIT WAS OBTAINED. RELIES ON THE CASE LAW: CHIEF CIT V. KESARIA TEA CO. LTD (2002) 254 ITR 434 (SC); - THAT S. 41(1) APPLIES TO TRADING RECEIPTS AND CAN NOT BE APPLIED TO CAPITAL/LOAN WAIVER AS IN THE PRESENT CASE; AND THAT THE SECTION COMES INTO PLACE ONLY IN A CASE WHERE PRIOR DEDUCTION HAS BEEN ALLOWED. IT IS ONLY WHEN AN ALLOWANCE OR DEDUCTION HAS BEEN MADE IN THE ASSESSMENT FOR ANY YEAR AND TH E SAME IS IN RESPECT OF LOSS, EXPENDITURE OR TRADING LIABI LITY THAT THE PROVISIONS OF S. 41(1) WOULD APPLY; - THAT THE ASSESSEE HAD WRONGLY INCLUDED THE WAIVER OF PRINCIPAL AMOUNT OF LOAN AS PART OF ITS INCOME UNDER THE HEAD OTHER INCOME AND HAD OFFERED THE SAME TO TAX AND SINCE T HE SAID AMOUNT IS NOT IN THE NATURE OF INCOME, THE SAME IS REQUIRED TO BE EXCLUDED WHILE COMPUTING THE NET LOSS; ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 16 OF 18 - RELIES ON THE FOLLOWING CASE LAWS: (I) CIT V. INDUSTRIAL CREDIT & DEVELOPMENT SYNDICATE (2 006) 285 ITR 310 (KAR); (II) CIT V. COMPAQ ELECTRIC LTD (2012) 204 TAXMAN 58 (KA R); & (III) CIT V. M/S. PHARMACIA UNITED LTD 2010-TIOL-382-HC-K AR-IT. 4.3.2 IN CONCLUSION, IT WAS SUBMITTED THAT THE PRIN CIPAL AMOUNT OF RS.2,57,08,826/- WRONGLY CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE, THE SAME REQUIRES TO BE EX CLUDED WHILE COMPUTING THE TOTAL INCOME. 4.3.3 ON THE OTHER HAND, THE LEARNED DR SUPPORTED T HE FINDINGS OF THE AUTHORITIES BELOW ON THE ISSUE. IT WAS SUBMITTED THAT THE LEARNED CIT (A), HAD ANALYSED THE ISSUE IN DEPTH AND CAME TO THE RIGHT CONCLUSION THAT THE AO WAS JUSTIF IED IN MAKING THE ADDITION OF RS.1,93,96,881/- U/S 43B OF THE ACT . IT WAS, THEREFORE, PLEADED THAT THE ASSESSEES APPEAL DESER VES TO BE DISMISSED. 4.4. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMIS SIONS, PERUSED THE RELEVANT MATERIAL ON RECORD AND ALSO TH E VARIOUS CASE LAW ON WHICH BOTH THE PARTIES HAVE PLACED RELIANCE ON. THE ASSESSEE UNDERSTOOD THE OTS OF RS.378.72 LAKHS AS B EING FIRST ATTRIBUTED TOWARDS INTEREST AND BALANCE TOWARDS PRI NCIPAL LEAVING A PORTION OF PRINCIPAL UNPAID AND WAIVED. ON THIS BAS IS, THE ASSESSEE CLAIMED INTEREST DEDUCTION U/S 43B AND OFFERED, THO UGH, WRONGLY THE WAIVED PRINCIPAL TO TAX. EVEN IF ONE WOULD UNDE RSTAND THE OTS OF RS.378.72 AS BEING FIRST ATTRIBUTED TOWARDS PRIN CIPAL AND BALANCE TOWARDS INTEREST, IT MEANS THAT UNPAID INTEREST OF RS.1,93,96,881 IS TO BE DISALLOWED U/S 43B. HOWEVER, THIS WOULD ALSO MEAN THAT THERE IS NO WAIVER OF PRINCIPAL AMOUNT. THIS WILL RENDER THE OFFER OF WAIVED ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 17 OF 18 PRINCIPAL SUM OF RS.2,57,08,826 MADE BY THE ASSESSE E ERRONEOUS. THE ERRONEOUS OFFER OF TAX OF RS.2,57,08,826 TOWARD S WAIVER OF PRINCIPAL SUM IS MORE THAN THE ERRONEOUS CLAIM OF I NTEREST U/S 43B OF RS.1,93,96,881. AS BOTH ERRONEOUS OFFER OF WAIVE D PRINCIPAL SUM TO TAX AND ERRONEOUS CLAIM OF INTEREST U/S 43B EMAN ATED FROM A SINGLE TRANSACTION/EVENT I.E. OTS, BOTH SHOULD BE U NDERSTOOD TO HAVE CANCELLED EACH OTHER. IN OTHER WORDS, WHICHEVE R WAY THE APPROPRIATION OF OTS IS UNDERSTOOD, THE ASSESSEE CA NNOT BE PUT INTO DOUBLE JEOPARDY (TAX ON WAIVED PRINCIPAL SUM AS WEL L AS DISALLOWANCE OF INTEREST U/S 43B). THESE TWO EFFECT S ARE MUTUALLY EXCLUSIVE AND CANNOT CO-EXIST. 4.4.1 THE FOLLOWING TABLE REFLECTS THE TAX TREATME NT, IF OTS IS FIRST APPROPRIATED TOWARDS PRINCIPAL AND THEN TOWAR DS INTEREST: A. ENTIRE AMOUNT OF OTS RS.3,78,72,000 B. TOWARDS PRINCIPAL RS.3,78,72,000 C BALANCE TOWARDS INTEREST NIL D UNPAID INTEREST RS. 1,93,96,881 E WAIVED PRINCIPAL SUM RS. 62,58,081 ACCORDINGLY, THE WAIVED PRINCIPAL SUM STANDS AT RS. 62,58,081 AGAINST WHICH THE ASSESSEE HAS OFFERED TO TAX RS.2, 57,08,826 LEAVING RS.1,94,50,745 AS EXCESS OFFERED. AT THE SA ME TIME, THIS WOULD MEAN THAT RS.1,93,96,881 IS REQUIRED TO BE DI SALLOWED U/S 43B AS UNPAID. 4.4.2 IN THE LIGHT OF ABOVE FACTS AND IN THE INTERE ST OF JUSTICE AND EQUITY, WE DIRECT THAT THE DISALLOWANCE OF RS.1,93, 96,881 U/S 43B IS ITA NO.818 OF 2011 KLN AGROTECHS PVT LTD BANGALORE PAGE 18 OF 18 TO BE SUBSUMED INTO THE OFFER OF RS.2,57,08,826 ON WAIVER OF PRINCIPAL. IT IS ORDERED ACCORDINGLY. 5. THEREFORE, THE APPEAL OF THE ASSESSEE IS ALLOWED TO THE EXTENT INDICATED ABOVE. ORDER PRONOUNCED AT THE END OF THE HEARING ON 2 ND AUGUST, 2013. SD/- SD/- (N. BARTHVAJA SANKAR) (GEORGE GEORGE K) VICE PRESIDENT JUDICIAL MEMBER BANGALORE, DATED 2 ND AUGUST, 2013. VNODAN/SPS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, ITAT, BANGALORE BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCHES, BANGALORE
