ACIT, Shimla V. M/s H.P. State Infrastructure Development Board, Shimla

ITA 837/CHANDI/2012

• Counselvise Citation: 83721514 RSA 2012
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 09-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N K SAINI
• Assessee Lawyers: VISHAL MOHAN
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A, CHANDIGARH BEFORE MS. SUSHMA CHOWLA, JUDICIAL MEMBER AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO. 837/CHD/2012 (ASSESSMENT YEAR : 2009-10) THE A.C.I.T., VS. M/S H.P. INFRASTRUCTURE DEVELO PMENT BOARD, SHIMLA. NEW HIMRUS BUILDING, CIRCULAR ROAD, SHIMLA. PAN: AAALH0040D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N.K. SAINI, DR RESPONDENT BY : SHRI VISHAL MOHAN DATE OF HEARING : 25.10.2012 DATE OF PRONOUNCEMENT : 30.10.2012 O R D E R PER SUSHMA CHOWLA, J.M, : THE APPEAL FILED BY THE REVENUE IS AGAINST THE ORDE R OF THE COMMISSIONER OF INCOME-TAX (APPEALS), SHIMLA DATED 10.05.2012 RELATING TO ASSESSMENT YEAR 2009-10 AGAINST THE ORD ER PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHOR T THE ACT). 2. THE ONLY GROUND OF APPEAL RAISED BY THE REVENUE READS AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES, THE LD. CIT(A) HAS ERRED IN DELETING ADDITION OF RS.7.70 CRORES ON ACCOUNT OF INTEREST. 3. THE LEARNED A.R. FOR THE ASSESSEE POINTED OUT TH AT THE ISSUE IN THE PRESENT APPEAL IS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL RELATING TO ASSESSMENT YEAR 2007-08. 2 4. THE LEARNED D.R. FOR THE REVENUE POINTED OUT THA T THE PAYMENT SCHEDULE WAS RESCHEDULED VIDE MEETING HELD ON 15.3. 2010 AND HENCE THE FINDINGS OF THE TRIBUNAL ARE NOT TO BE APPLIED. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE RAISED IN THE PRESENT APPEAL IS IN RELATION T O THE ADDITION MADE ON ACCOUNT OF INTEREST DEEMED TO BE RECEIVED BY THE AS SESSEE ON ADVANCE OF RS.67 CRORES MADE TO HIMACHAL PRADESH ROAD TRANSPOR T CORPORATION (HEREINAFTER REFERRED TO HRTC). THE ASSESSEE BOARD WAS CONSTITUTED TO ACT AS SPECIAL PURPOSE VEHICLE TO RAISE RESOURCES T O FINANCE THE DEVELOPMENT EXPENDITURE UNDER THE STATE PLAN ON BEH ALF OF THE STATE GOVERNMENT OF HIMACHAL PRADESH. DURING THE YEAR UN DER CONSIDERATION, THE ASSESSEE HAD DEBITED EXPENDITURE OF RS.304.14 C RORES AGAINST GROSS RECEIPT OF RS.111.77 CRORES AND HAD SHOWN DEFICIT O F 192.37 CRORES. THE SAID DEFICIT WAS TO BE REIMBURSED BY THE GOVERNMENT OF HIMACHAL PRADESH AS PER POLICY/DECISION OF THE GOVERNMENT OF HIMACHAL PRADESH THAT THE EXPENDITURE, IF ANY, IN EXCESS OF INCOME W OULD BE BORNE BY THE STATE GOVERNMENT. THE NET INCOME WAS DECLARED BY T HE ASSESSEE AT NIL IN THE RETURN OF INCOME FILED FOR THE CAPTIONED ASSESS MENT YEAR. THE ASSESSEE HAD ADVANCED A SUM OF RS.67 CRORES AND RS. 20 CRORES AS INTER CORPORATE TRANSFER/LOAN TO HRTC IN THE EARLIER YEAR S. THE ASSESSING OFFICER REQUISITIONED THE ASSESSEE DURING THE COURS E OF ASSESSMENT PROCEEDINGS TO EXPLAIN AS TO WHY INTEREST ON THE SA ID LOAN SHOULD NOT BE CHARGED. THE EXPLANATION OF THE ASSESSEE WAS THAT NO INTEREST WAS CHARGED ON THE LOAN TO GOVERNMENT OF HIMACHAL PRADE SH AND ALSO ON THE ADVANCE TO GOVERNMENT OF HIMACHAL PRADESH AS LOANS WERE RAISED ON BEHALF OF THE STATE GOVERNMENT AND ANY SURPLUS/DEFI CIT DURING THE YEAR WAS TO BE FUNDED BY THE STATE GOVERNMENT. THE ASSE SSEE ALSO POINTED OUT THAT THE DEFICIT OF RS.192.37 CRORES WAS REFLEC TED AS RECOVERABLE FROM 3 THE STATE GOVERNMENT AND HENCE NO PROFIT/LOSS WAS R EFLECTED IN ITS RETURN OF INCOME. THE ASSESSEE VIDE ANOTHER COMMUNICATION ALSO EXPLAINED THAT ON THE ADVANCE OF RS.20 CRORES, INTEREST OF RS.40,9 6,917/- WAS CHARGED AND WAS CREDITED TO THE INCOME ON ACCRUAL BASIS. I N RESPECT OF THE ADVANCE OF RS.67 CRORES, THE ASSESSEE CLAIMED THAT THE SAME WAS DONE ON BEHALF OF THE STATE GOVERNMENT AND VIDE RESOLUTION DATED 15.3.2010 IT HAS BEEN RESOLVED THAT RE-PAYMENT OF THE PRINCIPAL AMOUNT WOULD COMMENCE FROM FINANCIAL YEAR 2010-11 AND WOULD BE R EPAID IN TEN EQUAL YEARLY INSTALLMENTS. FURTHER INTEREST ON THE LOAN WOULD BE BORNE BY THE STATE GOVERNMENT AND HRTC WOULD PAY THE INTEREST ON THIS LOAN TO STATE GOVERNMENT DIRECTLY. THE ASSESSEE THUS CLAIMED THA T INTEREST ON THE LOAN RAISED BY THE ASSESSEE FOR DISBURSING THE SAID LOAN TO HRTC WAS ALSO BORNE BY THE GOVERNMENT AND FURTHER THE DEFICIT, IF ANY IS TO BE BORNE BY THE STATE GOVERNMENT. EVEN THE PROFITS, IF ANY, WE RE TO BE CREDITED IN THE GOVERNMENT ACCOUNT. THE ASSESSING OFFICER REJE CTED THE CLAIM OF THE ASSESSEE THAT THE INTEREST ON LOAN OF RS.67 CRO RES ADVANCED TO HRTC WAS TO BE CHARGED BY THE STATE GOVERNMENT AND HRTC WOULD PAY THE INTEREST ON THIS LOAN TO STATE GOVERNMENT AND CONSE QUENTLY THE ASSESSING OFFICER MADE AN ADDITION OF RS.7,70,50,000/- AS THE INTEREST @ 11.5% ON THE SAID LOAN OF RS.67 CRORES AND INCLUDED THE SAME AS INCOME OF THE ASSESSEE. THE PLEA OF THE ASSESSEE THAT THE ISSUE STANDS COVERED BY THE ORDER OF THE TRIBUNAL RELATING TO ASSESSMENT YEAR 2 007-08 WAS NOT ACCEPTED AS THE APPEAL WAS FILED BEFORE THE HON'BLE HIGH COURT AGAINST THE SAID DECISION. THE CIT (APPEALS), HOWEVER, REL YING SQUARELY UPON THE RATIO LAID DOWN BY THE TRIBUNAL DELETED THE ADD ITION OF RS.7,70,50,000/- VIDE ORDER DATED 10.5.2012 AND ANO THER ORDER PASSED UNDER SECTION 154/155 OF THE ACT DATED 4.6.2012. 4 6. THE REVENUE IS IN APPEAL AGAINST THE AFORESAID O RDER OF THE CIT (APPEALS). 7. WE FIND THAT THE ISSUE RAISED IN THE PRESENT APP EAL IS IDENTICAL TO THE ISSUE RAISED BEFORE THE TRIBUNAL IN ITA NO.1434 /CHD/2010 RELATING TO ASSESSMENT YEAR 2007-08 IN THE APPEAL FILED BY THE ASSESSEE. THE TRIBUNAL VIDE ORDER DATED 30.3.2011 CONSIDERING THE ISSUE OF CHARGING OF INTEREST ON THE LOANS DISBURSED TO HRTC AND ALSO CO NSIDERING THE BOARDS RESOLUTION DATED 15.3.2010, OBSERVED AS UND ER: 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THAT THE ASSESSEE-BOARD IS A BODY CORPORATE CONSTITUTED BY THE H.P. INFRASTRUCTURE DEVELOPMENT ACT, 2001 WHICH WAS CONSENTED TO BY THE GOVERNOR ON 23 RD OF JUNE, 2002. THE COPY OF THE SAID ACT IS PLACED ON RECORD AT PAGE 13 OF THE PAPER BOO K. 6. THAT THE PREAMBLE OF THE HP INFRASTRUCTURE DEVELOPMENT ACT, 2001 READS AS UNDER : TO PROVIDE FOR A FRAMEWORK FOR PARTICIPATION BY PERSONS OTHER THAN THE STATE GOVERNMENT AND GOVERNMENT AGENCIES IN FINANCING, CONSTRUCTION, MAINTENANCE AND OPERATION OF INFRASTRUCTURE PROJECTS AND TO RAISE RESOURCES ON BEHALF OF THE STATE GOVERNMENT FOR INFRASTRUCTURE DEVELOPMENT AND FOR THAT PURPOSE TO ESTABLISH A BOARD TO PROVIDE FOR THE MATTERS RELATING THERETO. 7. THAT AS PER SECTION 3 OF THE SAID ACT, THE ASSES SEE BOARD WAS DECLARED TO BE A BODY CORPORATE TO BE CALLED AS HIMACHAL PRADESH INFRASTRUCTURE DEVELOPME NT BOARD HAVING PERPETUAL SUCCESSION AND A COMMON SEAL . AS PER SECTION 5 OF THE AFORESAID ACT, THE CONSTITU TION OF THE ASSESSEE-BOARD IS AS UNDER : (A) THE CHIEF SECRETARY TO THE GOVERNMENT WHO SHALL BE THE CHAIRPERSON; (B) THE FINANCE SECRETARY OR ANY STATE GOVERNMENT OFFICER OF OTHER EQUIVALENT RANK SHALL BE THE CHIEF EXECUTIVE OFFICER, TO BE APPOINTED BY THE STATE GOVERNMENT, BY NOTIFICATION; (C) NOT EXCEEDING TEN OTHER MEMBERS, WHICH SHALL INCLUDE SECRETARIES TO THE GOVERNMENT IN THE DEPARTMENTS OF POWER, PUBLIC WORKS, IRRIGATION AND PUBLIC HEALTH, URBAN DEVELOPMENT, TOWN AND COUNTRY PLANNING, TOURISM, INDUSTRY, FINANCE AND 5 PLANNING, TO BE APPOINTED BY THE GOVERNMENT BY NOTIFICATION. 8. THE FUNCTIONS OF THE BOARD ARE PRESCRIBED UNDER SECTION 14 AND ONE SUCH FUNCTION WAS TO, (J) ACT AS A SPECIAL PURPOSE VEHICLE TO RAISE TO FINANCE DEVELOPMENT EXPENDITURE UNDER THE STATE PLAN ON BEHALF OF THE STATE GOVERNMENT AND ALSO TO DISCHARGE OBLIGATIONS ON THIS ACCOUNT ON BEHALF OF THE STATE GOVERNMENT FROM REVENUE AND OTHER RECEIPTS ACCRUING TO THE STATE GOVERNMENT FROM SUCH DEVELOPMENT EXPENDITURE; AND (K) PERFORM SUCH OTHER FUNCTIONS AS MAY BE ENTRUSTED TO IT BY THE STATE GOVERNMENT, BY NOTIFICATION. 9. THAT VIDE LETTER BEARING NO. FIN-IF(C) 45- 1/99(IDB) DATED 30.07.2002 ISSUED BY THE DEPARTMENT OF FINANCE, GOVERNMENT OF H.P., IT HAS BEEN STIPULA TED AS UNDER : AS PER PROVISIONS OF SECTION 14(J) OF H.P. INFRASTRUCTURE DEVELOPMENT ACT, THE BOARD SHALL ACT AS A SPECIAL PURPOSE VEHICLE TO RAISE RESOURCES TO FINANCE DEVELOPMENT EXPENDITURE UNDER THE STATE PLAN ON BEHALF OF THE STATE GOVERNMENT AND ALSO TO DISCHARGE OBLIGATIONS ON BEHALF OF THIS ACCOUNT ON BEHALF OF THE STATE GOVERNMENT FROM REVENUE AND OTHER RECEIPTS ACCRUING TO THE STATE GOVT. FROM SUCH DEVELOPMENT EXPENDITURE. THE STATE GOVERNMENT SHALL MEET ALL THE EXPENDITURE INCURRED BY THE BOARD FOR RAISING OF FUNDS, INCLUDING PAYMENT OF INTEREST AND REPAYMENT OF PRINCIPAL. AL INCOME GENERATED BY THE BOARD ON INVESTMENT OF FUNDS RAISED, WHILE ACTING AS SPECIAL PURPOSE VEHICLE, ON BEHALF OF THE STATE GOVERNMENT SHALL BE CREDITED TO THE GOVERNMENT OF HIMACHAL PRADESH AFTER MEETING THE EXPENDITURE ON THE MAINTENANCE AND WORKING OF THE OFFICE OF THE BOARD. THE EXPENDITURE IN EXCESS, IF ANY, SHALL BE REIMBURSED BY THE STATE GOVERNMENT THROUGH BUDGETARY SUPPORT. 10. THAT THE ASSESSEE-BOARD IS THUS A SPECIAL PURPO SE VEHICLE OF THE STATE GOVT. AND FUNCTION OF THE BOAR D IS TO RAISE FUNDS TO FINANCE DEVELOPMENT EXPENDITURE U NDER THE STATE PLAN. THE ASSESSEE BOARD WAS CONSTITUTED TO DISCHARGE OBLIGATIONS ON BEHALF OF STATE GOVT. FROM REVENUE AND OTHER RECEIPTS ACCRUING TO THE STATE GO VT. FROM SUCH DEVELOPMENT EXPENDITURE. AS IS APPARENT FROM THE COMMUNICATION REFERRED ABOVE BETWEEN THE PRINCIPAL SECRETARY (FINANCE) TO THE GOVT. OF H.P. AND THE CHIEF EXECUTIVE OFFICER OF THE ASSESSEE-BOARD DATED 30.7.2002, THE STATE GOVT. SHALL MEET ALL TH E EXPENDITURE INCURRED FOR RAISING OF FUNDS, INCLUDIN G PAYMENT OF INTEREST AND REPAYMENT OF PRINCIPAL. 6 FURTHER ALL THE INCOME GENERATED BY THE ASSESSEE-BO ARD ON INVESTMENTS OF FUNDS RAISED, ON BEHALF OF THE ST ATE GOVT. IS TO BE CREDITED TO THE ACCOUNT OF STATE GOV T. AFTER MEETING ALL THE EXPENDITURE AND WHERE THE EXPENDITURE IS IN EXCESS OF THE RECEIPTS, SUCH EXCE SS IS ALSO TO BE MET BY STATE GOVT. 11. THE ASSESSEE-BOARD HAD FILED ITS RETURN OF INCO ME RELATING TO ASSESSMENT YEAR 2002-03 DECLARING NIL INCOME, THOUGH THERE WAS EXCESS OF EXPENSES OVER INCOME AMOUNTING TO RS.1,91,222/-. THE INCOME WAS ASSESSED AT NIL VIDE ORDER PASSED UNDER SECTION 143 (3) OF THE ACT AND THE A.O. HAS ACCEPTED THAT AS PER LE TTER OF STATE GOVT., THE EXPENDITURE, IN EXCESS, WOULD B E REIMBURSED BY THE STATE GOVT., THROUGH BUDGETARY SUPPORT. THE COPY OF THE ASSESSMENT ORDER RELATING TO ASSESSMENT YEAR 2002-03 IS PLACED AT PAGES 17 & 18 OF THE PAPER BOOK. SIMILARLY, INCOME RELATING TO ASSESSMENT YEAR 2004-05 IS FILED AND ACCEPTED AT NI L DESPITE DEFICIT OF RS.113.59 CR. AND FOR ASSESSMENT YEAR 2005-06 ALSO AT NIL AS AGAINST DEFICIT OF RS.225.69 CR. THE ASSESSMENT ORDERS PASSED UNDER SECTION 143(3) O F THE ACT RELATING TO ASSESSMENT YEARS 2004-05 & 2005 -06 ARE PLACED TO PAGES 20 & 21 OF THE PAPER BOOK. TH E ASSESSEE HAD FURNISHED RETURN OF INCOME AT NIL FOR ASSESSMENT YEAR 2006-07. FURTHER FOR THE YEAR UNDE R CONSIDERATION, THERE WAS DEFICIT OF RS.242.49 CR. B UT THE RETURN OF INCOME HAS BEEN FILED AT NIL. 12. THE ISSUE ARISING BEFORE US IS IN RESPECT OF DISBURSEMENT OF FUNDS TOTALING RS.67 CR. TO HIMACHA L PRADESH ROAD TRANSPORT CORPORATION (HRTC IN SHORT). THE STATE GOVERNMENT VIDE LETTER DATED FIN-IF(C) 1 7- 4/91 DATED 30-11-2005 TO THE ASSESSEE-BOARD DIRECTE D AS UNDER : I AM DIRECTED TO INVITE YOUR REFERENCE TO ITEM NO.49.4 OF THE BOARD MEETING OF HPIDB HELD ON 16.11.05 UNDER THE CHAIRMANSHIP OF CHIEF SECRETARY VIDE WHICH AN INTER CORPORATE TRANSFER/LOAN OF RS.67.00 CRORE TO H.R.T.C. ON BEHALF OF STATE GOVT. WAS APPROVED WITH THE FOLLOWING CONDITIONS:- AN INTER CORPORATE TRANSFER/LOAN OF RS.67.00 CRORE FROM IDB TO H.R.T.C. ON BEHALF OF THE STATE GOVT. HAS BEEN APPROVED. THE LOAN WILL BE REPAID IN TEN YEARS BY THE H.R.T.C. REGULARLY WITH NO MORATORIUM. THE INTEREST ON THIS LOAN FOR THE FIRST THREE YEARS WILL BE PAID BY STATE GOVT. AND THEREAFTER BY H.R.T.C. REGULARLY. YOUR ARE REQUESTED TO TAKE NECESSARY ACTION IN THIS BEHALF UNDER INTIMATION TO THIS OFFICE. 7 13. THE ASSESSEE ENTERED INTO AN INTER CORPORATE LOAN/TRANSFER AGREEMENT DATED 9.12.2005 WITH HRTC UNDER WHICH IT IS STIPULATED THAT ON THE RECOMMENDA TION OF FINANCE DEPTT. TO THE GOVT. OF H.P. VIDE LETTER DATED 30.11.2005, A LOAN OF RS.67 CR. HAD BEEN GRANTED BY THE ASSESSEE TO HRTC TO ENABLE IT TO DISCHARGE THE GPF LIABILITIES THE SAID LOAN WAS TO BEAR INTEREST @ 8 % P.A. VIDE CLAUSE 2 OF THE AGREEMENT, THE SAID INTE REST IS TO SERVICED BY THE FINANCE DEPARTMENT FOR A PERI OD OF 3 YEARS AND THEREAFTER BY HRTC. THE SAID LOAN W AS TO BE REPAID IN 10 YEARS IN 40 QUARTERLY INSTALLMEN TS. THE COPY OF THE AGREEMENT IS PLACED AT PAGES 22 TO 26 OF THE PAPER BOOK. THE ASSESSEE DID NOT PROVIDE INTEREST ON THE SAID LOAN IN ITS ACCOUNTS FOR THE Y EAR UNDER CONSIDERATION. THE A.O. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, OBSERVED THAT LOAN OF RS.67 CR. WAS ADVANCED VIDE LETTER DATED 30.11.2005 AND A S PER THE SAME, THE INTEREST FOR THE FIRST THREE YEAR S IS TO BE PAID BY STATE GOVT. AND THEREAFTER BY THE HRTC. THE A.O. HELD THAT AS THE ASSESSEE WAS FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING, INTEREST ON SAID ADVANCE HAVING ACCRUED IS TO BE ASSESSED AS INCOME OF THE ASSESSEE. 14. THE QUESTION WHICH ARISES BEFORE US IS WHETHER SUCH INTEREST IS INCLUDIBLE IN THE HANDS OF ASSESSE E. ADMITTEDLY, THE LOAN WAS ADVANCED AT THE BEHEST OF STATE GOVT. AND UNDER THE SANCTION LETTER IT IS STIPULATED THAT FOR THE FIRST THREE YEARS THE INTER EST ON SAID LOAN IS TO BE PAID BY STATE GOVT. THE LOAN WA S ADVANCED BY THE ASSESSEE-BOARD, WHICH IS ACTING AS A SPECIAL PURPOSE VEHICLE ON BEHALF OF STATE GOVT. AN D IS TO DISCHARGE OBLIGATION ON BEHALF OF THE STATE GOVT . FURTHER INCOME ARISING AFTER MEETING EXPENDITURE IS OF THE STATE GOVT. AND WHERE EXPENDITURE IS IN EXCESS OF THE RECEIPTS, THEN SUCH EXPENDITURE IS TO BE REIMBU RSED BY THE ASSESSEE-BOARD. THE ASSESSEE-BOARD IS CONSTITUTED BY THE REPRESENTATIVES OF GOVT. OF H.P. THE AFORESAID LOAN OF RS.67 CR. WAS ADVANCED TO HRTC ON THE DIRECTIONS OF STATE GOVT. VIDE LETTER DATED 30.11.2005, WHICH IN ITS BOARD MEETING DATED 16.11.2005 HAD DIRECTED THE ASSESSEE TO DISBURSE RS .67 CR. TO HRTC ON BEHALF OF STATE GOVT. THE SAID LOAN WAS FOR A PERIOD OF 10 YEARS AND THE INTEREST FOR T HE PERIOD OF FIRST 3 YEARS WAS TO BE PAID BY STATE GOV T. WE FIND MERIT IN THE CLAIM OF THE ASSESSEE THAT THE SAID INTEREST, IF ANY, ACCRUED TO THE STATE GOVT. AS THE INCOME OF THE ASSESSEE-BOARD AFTER EXPENDITURE WAS THE INCOME OF THE STATE GOVT. AND WHERE THE SAME IS TO BE RECEIVED BY STATE GOVT. AND ALSO PAID BY STATE GOVT ., NO SUCH INTEREST ACCRUES OR IS TO BE ACCOUNTED FOR BY THE ASSESSEE-BOARD. HENCE, NO SUCH INTEREST IS ASSESSA BLE IN THE HANDS OF ASSESSEE. WE ARE ALSO IN AGREEMENT WITH THE ALTERNATE PLEA OF THE ASSESSEE THAT EVEN I F SUCH INCOME IS INCLUDED IN THE HANDS OF ASSESSEE, THE SA ME SHALL AT BEST REDUCE THE EXPENDITURE OVER RECEIPTS FOR THE YEAR UNDER APPEAL AND NO SEPARATE ADDITION IS 8 MERITED ON THIS ACCOUNT. ONE VIEW IS FURTHER SUPP ORTED FROM THE BOARD RESOLUTION OF THE 97 TH BOARD MEETING HELD ON 15/03/2010 IN WHICH IT HAS BEEN RESOLVED AS UNDER : BOARD DISCUSSED THE PROPOSAL RECEIVED FROM THE PRINCIPAL SECRETARY (TRANSPORT) TO THE GT. OF H.P. AND APPROVED THE RE-SCHEDULING OF THE INTER CORPORATE TRANSFER/LOAN TO HRTC FROM 7 YEARS TO 10 YEARS, THE PRINCIPAL AMOUNT SHALL BE RE-PAID IN 10 EQUAL YEARLY INSTALLMENTS COMMENCING FROM THE FINANCIAL YEAR 2010-11. SINCE THE INTER CORPORATE TRANSFER/LOAN HAS BEEN GIVEN ON BEHALF OF THE STATE GOVERNMENT., THE INTEREST ON THIS SHALL BE BORNE BY THE STATE GOVERNMENT. HOWEVER THE HRTC WILL PAY THE INTEREST ON THIS LOAN TO THE STATE GOVERNMENT DIRECTLY. 8. THE ISSUE RAISED IN THE PRESENT APPEAL BEING ID ENTICAL AND THE SAME BEING COVERED BY THE ORDER OF THE TRIBUNAL DATED 30 .3.2011 WE FIND NO INFIRMITY IN THE ORDER OF THE CIT (APPEALS) IN FOL LOWING THE SAME AND DELETING THE ADDITION OF RS.7.70 CRORES ON ACCOUNT OF INTEREST DEEMED TO ACCRUE ON THE LOANS ADVANCED BY THE ASSESSEE. FOLL OWING THE SAME WE DISMISS GROUND OF APPEAL RAISED BY THE REVENUE. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH AY OF OCTOBER, 2012. SD/- SD/- (MEHAR SINGH) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 30 TH OCTOBER, 2012 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 9