M/S J.V STEEL TRADERS vs. ADDL COMMISSIONER OF INCOME TAX MOGA RANGE

ITA/400/2014HC Punjab & HaryanaPHHC01109553201421 December 2020Author: MR JUSTICE JASWANT SINGH,MR. JUSTICE SANT PARKASH2 pages
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What were the facts?

The assessee, M/s. J.V. Steel Traders, a partnership firm, filed an appeal under Section 260-A of the Income Tax Act, 1961, against an order dated 21.05.2014 passed by the Income Tax Appellate Tribunal, Amritsar Bench. The appeal challenged additions of ₹45 lacs for the Assessment Year 2007-08. The High Court admitted the appeal on 09.03.2015, framing specific questions of law. Subsequently, the assessee filed an application (CM No. 10760-CII of 2020) seeking unconditional withdrawal of the appeal. The reason cited for withdrawal was that the impugned Tribunal order had been recalled, and the Revenue's appeal before the Tribunal had been withdrawn due to monetary limits.

What did the High Court hold?

The High Court allowed the application for withdrawal of the appeal. The Tribunal's order dated 21.05.2014, which was under challenge, had been recalled. Furthermore, the appeal filed by the Revenue before the Tribunal had itself been withdrawn, inter alia, on account of monetary limits. In light of these developments, the High Court accepted the assessee's oral request and dismissed the main appeal as withdrawn, subject to all just exceptions. No decision was made on the merits of the questions of law originally framed. The operative direction was the dismissal of the appeal as withdrawn.

What were the issues?

1. Whether on the facts and circumstances of the case, the Ld. Tribunal has wrongly relied upon the judgment of F.C. Sondhi and Co. by holding that the insurance premium paid by the petitioner firm on account of Keyman Insurance Policy is not deductible as business expenditure, whereas the Assessing Officer had not even examined the same? (Question of law/mixed law and fact, concerning deductibility of business expenditure under the Income Tax Act, 1961). 2. Whether on the facts and circumstances of the case, the Ld. Tribunal is justified in disallowing the premium paid on Keyman Insurance Policy? (Question of law/mixed law and fact, concerning deductibility of business expenditure under the Income Tax Act, 1961). Assessee's contentions: The assessee argued that the Tribunal wrongly relied on the F.C. Sondhi and Co. judgment and disallowed the Keyman Insurance Policy premium as business expenditure, especially since the Assessing Officer had not examined the policy. The assessee sought to withdraw the appeal. Revenue's contentions: The judgment does not record any specific contentions made by the Revenue in response to the withdrawal application. However, it is noted that the Revenue's appeal before the Tribunal had been withdrawn.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

102 IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH

C.M. No. 10760-CII of 2020 in/and I.T.A. No. 400 of 2014 (O&M)

Date of Decision: 21.12.2020

M/s. J.V. Steel Traders, Moga .......... Appellant Versus Addl. Commissioner of Income Tax, Moga .......... Respondent CORAM: HON'BLE MR. JUSTICE JASWANT SINGH HON'BLE MR. JUSTICE SANT PARKASH Present: Mr. Rishab Singla, Advocate for the applicant-appellant. [ The aforesaid presence is being recorded through video conferencing since the proceedings are being conducted in virtual court ] **** JASWANT SINGH, J. (ORAL) The Assessee, a partnership firm, had filed an appeal under Section 260-A of the Income Tax Act, 1961 against the order dated 21.05.2014 (Annexure A-6) passed by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (in short “the Tribunal”), raising a demand on account of the additions of ` 45 lacs for the Assessment Year 2007-08.

The appeal was admitted vide order dated 09.03.2015 raising the following questions of law:- “ (i) Whether on the facts and circumstances of the case, the Ld. Tribunal has wrongly relied upon the judgment of F.C. Sondhi and Co. by holding

The order continues below.

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