Kerala Infrastructure Investment fund Board, Trivandrum V. DCIT, Trivandrum

MA 91/COCH/2009

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 7985 (ITAT-COCHIN)
• Duration Of Justice: 2 year(s) 11 month(s) 16 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 25-05-2012
• Assessment Year: misc
• Appeal Filed On: 08-06-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S R SENAPATI
• Assessee Lawyers: ANITHA SUMANTH
• Keywords: Business expenditure

Judgement Text

1 MA NOS.90 TO 94/COCH/2009 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKARA N(AM) M.A NOS. 90 TO 94/COCH/2009 (ARISING OUT OF CO NOS. 81 TO 84/COCH/2008 & CO NO. 44/COCH/2008) (ARISING OUT OF ITA NOS.814 TO 817/COCH/2008 & ITA NO.751/COCH/2007) (ASSESSMENT YEARS 2000-01, 2001-02, 2002-03, 2003-04 & 2004-05) THE KERALA INFRASTRUCTURE INVESTMENT FUND BOARD : DY .CIT, CIR. 1(2) GOVERNMENT SECRETARIAT RANGE-1, TRIVANDRUM TRIVANDRUM 695 001 PAN : AAAJK0192K (APPLICANT) (RESPONDENT) APPLICANT BY : SMT. ANITHA SUMANTH RESPONDENT BY : SHRI S.R. SENAPATI DATE OF HEARING : 25-05-2012 DATE OF PRONOUNCEMENT : 25-05-2012 O R D E R PER N.R.S. GANESAN (JM) THE ASSESSEE FILED THE MISCELLANEOUS APPLICATIONS FOR THE ASSESSMENT YEARS 2000-01, 2001-02, 2002-03, 2003-04 & 2004-05. SINCE CO MMON ISSUE ARISES FOR CONSIDERATION IN ALL THE MISCELLANEOUS APPLICATIONS , WE HEARD THEM TOGETHER AND ARE DISPOSED OF BY THIS COMMON ORDER. 2. SMT. ANITHA SUMANTH, THE LD.COUNSEL FOR THE ASSE SSEE SUBMITTED THAT FOR THE ASSESSMENT YEAR 2004-05 THERE WAS A DELAY OF 249 DAYS IN FILING THE CROSS OBJECTION. HOWEVER, THERE IS NO DELAY IN FILING TH E CROSS OBJECTION IN RESPECT OF 2 MA NOS.90 TO 94/COCH/2009 OTHER YEARS. THIS TRIBUNAL BY MISTAKE DISMISSED ALL THE CROSS OBJECTIONS OF THE ASSESSEE ON THE GROUND THAT ALL THE CROSS OBJECTION S ARE DELAYED BY 249 DAYS. ACCORDING TO LD.COUNSEL, THE CROSS OBJECTION IN CO NO.44/COCH/2008 FOR THE ASSESSMENT YEAR 2004-05 ALONE IS BARRED BY LIMITATI ON BY 249 DAYS AND ALL OTHER CROSS OBJECTIONS WERE WITHIN THE PRESCRIBED TIME LI MIT UNDER THE ACT. THEREFORE, THERE IS AN ERROR TO THAT EXTENT. THE LD.COUNSEL F OR THE ASSESSEE FURTHER SUBMITTED THAT IN RESPECT OF THE DEPARTMENTAL APPEA L, THE DEPARTMENT HAS FILED APPEALS BEFORE THE HIGH COURT AND THE HIGH COURT BY JUDGMENT DATED 11-12-2009 UPHELD THE ORDERS OF THE TRIBUNAL. THEREFORE, THE ASSESSEE HAD NO OCCASION TO TAKE UP THE MATTER BEFORE THE HIGH COURT. HOWEVER, THE ASSESSEE APPREHENDS THAT IN CASE THE JUDGMENT OF THE HIGH COURT IS REVE RSED BY THE SUPREME COURT, THE ISSUE RAISED BY THE ASSESSEE IN CROSS OBJECTION SHALL BE OPEN FOR ADJUDICATION. ON A QUERY FROM THE BENCH AS TO WHAT WAS THE ISSUE RAISED IN THE CROSS OBJECTION, THE LD.COUNSEL EXPLAINED THAT THE MAIN CASE OF THE ASSESSEE WAS THAT THE ASSESSEE HAD ALREADY COMMENCED THE BUSINESS AND THEREFORE, T HE INTEREST ON BORROWED LOAN HAS TO BE ALLOWED AS BUSINESS EXPENDITURE. TH E ALTERNATIVE CONTENTION OF THE ASSESSEE IN THE CROSS OBJECTION IS THAT EVEN AS SUMING THAT THE INTEREST IS ASSESSED UNDER THE HEAD INCOME FROM OTHER SOURCES , THE ENTIRE EXPENDITURE INCLUDING THE INTEREST PAID ON BORROWED FUNDS IS EL IGIBLE FOR DEDUCTION AGAINST THE INTEREST INCOME DERIVED. THIS ALTERNATIVE CONTENTI ON OF THE ASSESSEE HAS TO BE ADJUDICATED BY THIS TRIBUNAL ON MERIT. 3. ON THE CONTRARY, SHRI S.R. SENAPATI, THE LD.DR S UBMITTED THAT SINCE THE HIGH COURT HAS ALREADY CONFIRMED THE ORDER OF THE TRIBUN AL IN RESPECT OF THE DEPARTMENTAL APPEALS FILED AGAINST THE ORDER OF THE TRIBUNAL, THE CROSS OBJECTIONS HAVE BECOME INFRUCTUOUS AND IT IS OPEN TO THE ASSES SEE TO AGITATE THE MATTER IN THE APPROPRIATE FORUM. ON A QUERY FROM THE BENCH W ITH REGARD TO THE REASON FOR 3 MA NOS.90 TO 94/COCH/2009 DISMISSAL OF THE CROSS OBJECTION ON THE GROUND OF D ELAY IN FILING THE CROSS OBJECTIONS BY 249 DAYS, THE LD.DR SUBMITTED THAT ON THE FACE OF THE RECORD THE CONTENTION OF THE LD.COUNSEL FOR THE ASSESSEE IS CO RRECT AND THE ORDER MAY BE RECTIFIED TO THAT EXTENT. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE RECORDS. FOR THE ASSESSMENT YEAR 2004-05 THIS T RIBUNAL FOUND THAT THERE WAS A DELAY OF 249 DAYS AND THEREFORE, CONDONATION OF D ELAY WAS DENIED. ONCE THE BENCH DISMISSED THE CROSS OBJECTION ON THE GROUND O F BELATED FILING OF CROSS OBJECTION, THIS TRIBUNAL CANNOT REVIEW ITS EARLIER ORDER. THEREFORE, FOR THE ASSESSMENT YEAR 2004-05 WE FIND NO MERIT IN THE CONT ENTION OF THE ASSESSEE. HOWEVER, FOR ALL OTHER YEARS, ADMITTEDLY, THERE WAS NO DELAY IN FILING THE CROSS OBJECTION. THEREFORE, THE DISMISSAL OF CROSS OBJEC TION ON THE GROUND OF DELAY OF 249 DAYS IS FACTUALLY INCORRECT. AS SUBMITTED BY T HE LD.COUNSEL FOR THE ASSESSEE, THE CASE OF THE ASSESSEE THAT THE BUSINESS WAS ALRE ADY COMMENCED WAS ACCEPTED BY THE COMMISSIONER OF INCOME-TAX(A) AND THIS TRIBUN AL AS WELL. ONCE THE BUSINESS WAS HELD TO BE COMMENCED, THE INTEREST ON THE BORROWED FUNDS HAS TO BE ALLOWED AS BUSINESS EXPENDITURE. IN VIEW OF THI S FINDING OF THE TRIBUNAL IN THE DEPARTMENTAL APPEAL, IT MAY NOT BE NECESSARY TO GO INTO THE ALTERNATIVE GROUND RAISED IN THE CROSS OBJECTION. THE ALTERNATIVE GRO UND HAS TO BE CONSIDERED PROVIDED THE MAIN GROUND RAISED BY THE ASSESSEE WAS DISMISSED BY THE TRIBUNAL. IN THIS CASE, THE MAIN GROUND THAT THE BUSINESS OF THE ASSESSEE WAS ALREADY COMMENCED WAS ACCEPTED BY THIS TRIBUNAL, IT MAY NOT BE NECESSARY TO GO INTO THE ALTERNATIVE SUBMISSIONS RAISED BY THE ASSESSEE. 5. NOW COMING TO THE APPREHENSION OF THE ASSESSEE T HAT IF THE JUDGMENT OF THE HIGH COURT IS REVERSED BY THE SUPREME COURT, TH E ISSUE SHOULD BE OPEN FOR 4 MA NOS.90 TO 94/COCH/2009 ADJUDICATION, SINCE THIS TRIBUNAL HAS NOT ADJUDICAT ED ON THE ALTERNATIVE CONTENTIONS RAISED BY THE ASSESSEE IN THE CROSS OBJ ECTION IT IS ALWAYS OPEN TO THE ASSESSEE TO AGITATE THE SAME PROVIDED THE MATTER WA S REMANDED BACK TO THE FILE OF THE LOWER AUTHORITY. AS ON DATE THERE IS NO NEC ESSITY FOR CONSIDERING THE ALTERNATIVE SUBMISSION WHICH WAS RAISED IN THE CROS S OBJECTION. THEREFORE, WE DO NOT FIND ANY MERIT IN THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE. ACCORDINGLY ALL THE MISCELLANEOUS APPLICATIONS FILE D BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON THIS 25 TH DAY OF MAY, 2012. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 25 TH MAY, 2012 PK/- COPY TO: (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH