COMMISSIONER OF INCOME TAX-III vs. TRANS INDIA CINEMA

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TAXAP/743/2010HC GujaratGJHC24026732201011 June 2012Author: HONOURABLE MR. JUSTICE VIJAY MANOHAR SAHAI,HONOURABLE MR. JUSTICE N.V.ANJARIA3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeals were concluded by findings of fact. It noted that the ITAT had upheld the order of the CIT(A) and recorded a finding of fact that the additions made by the Assessing Officer were rightly deleted by the CIT(A). The Court referred to its own Division Bench decision in Tax Appeal No.474 of 2010 (Commissioner of Income Tax-I vs. Miraa Processors Pvt.Ltd.) decided on April 11, 2012, which, after considering the Apex Court's decision, held that the assessee had not claimed any cessation of any kind of liability. The High Court found no error in the order of the CIT(A) or the ITAT and concluded that no substantial questions of law arose for consideration. Consequently, both Tax Appeals filed by the Revenue were dismissed. The operative direction was the dismissal of the appeals.

What were the facts?

The Revenue filed two appeals before the High Court of Gujarat challenging the orders of the Income Tax Appellate Tribunal (ITAT). The Assessing Officer (AO) had made additions to the assessee's income under Section 41(1) of the Income Tax Act, 1961, on October 16, 2007. The assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)], who allowed the appeals and set aside the AO's order on January 19, 2009. The Revenue then appealed to the ITAT, which dismissed the Revenue's appeals. The assessee also filed an appeal regarding additions, which was allowed by the ITAT. The present appeals by the Revenue concern the deletion of additions made by the AO regarding advances received against tenements/shops, sundry creditors, and an advance from Ganesh Housing Corporation.

What were the issues?

1. Whether the Appellate Tribunal was right in law and on facts in reversing the order passed by the CIT(A) and thereby deleting the addition of Rs. 20,85,103/- made in respect of advances received against tenements/shops, as per Section 41(1) of the Income Tax Act? 2. Whether the Appellate Tribunal was right in law and on facts in reversing the order passed by the CIT(A) and thereby deleting the addition of Rs. 2,33,840/- made in respect of sundry creditors, as per Section 41(1) of the Income Tax Act? 3. Whether the Appellate Tribunal was right in law and on facts in reversing the order passed by the CIT(A) and thereby deleting the addition of Rs. 22,51,000/- made in respect of advance from Ganesh Housing Corporation, as per Section 41(1) of the Income Tax Act? Assessee's Contentions: The judgment does not record specific contentions made by the assessee before the High Court. However, it is implied that the assessee supported the ITAT's decision to delete the additions. Revenue's Contentions: The Revenue argued that the Appellate Tribunal was wrong in reversing the order of the CIT(A) and deleting the additions made by the Assessing Officer concerning advances received against tenements/shops, sundry creditors, and advance from Ganesh Housing Corporation.

Which sections of the Income-tax Act were involved?

Section 41(1)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
TAXAP/743/2010 1/3 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL No. 743 of 2010 With TAX APPEAL No. 744 of 2010 For Approval and Signature: HONOURABLE MR.JUSTICE V. M. SAHAI HONOURABLE MR.JUSTICE N.V. ANJARIA ========================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================= COMMISSIONER OF INCOME TAX-III - Appellant(s) Versus TRANS INDIA CINEMA - Opponent(s) ========================================= Appearance : MRS MAUNA M BHATT for the Appellant. MR SN DIVATIA for the Opponent. ========================================= CORAM : HONOURABLE MR.JUSTICE V. M. SAHAI and HONOURABLE MR.JUSTICE N.V. ANJARIA Date : 11/06/2012 TAXAP/743/2010 2/3

JUDGMENT ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE V. M. SAHAI)

1.

The Revenue has filed these two Appeals. We have heard Ms.Mauna M.Bhatt, learned counsel appearing for the revenue and Mr.S.N.Divetia, learned counsel appearing for the respondent. The Assessing Officer passed an assessment order on 16.10.2007 under section 41(1) of the Income Tax Act (for short "The Act") by making certain additions. Thereafter the respondent filed an appeal. The Commissioner of Income Tax (Appeals) allowed

the Appeal by order dated 19.1.2009 and set aside the order of the assessing officer. The Revenue filed Appeals before Income Tax Appellate Tribunal which had been dismissed.

2.

The Assessing Officer passed an order making two additions, one with regard to advance received against sanitary shop and the other in respect of sundry. Therefore, the respondents filed two appeal before Commissioner of Income Tax (Appeals) which were allowed by common order dated 19.1.2009 and addition was deleted. The appellant challenged the order of CIT(Appeals) whereas the assessee also filed appeal. Both the appeals were heard together and decided by common judgment and appeal of the revenue was dismissed and the appeal of the assessee which was with regard to addition was allowed and additions were set aside. Tax Appeal No.743 of 2010 has been filed by the revenue on the following proposed substantial questions of law. A. Whether the Appellate Tribunal is right in law and on facts in reversing the order passed by CIT(A) and thereby deleting the addition of Rs. 20,85,103/- made in respect of advances received against tenements/shops ?

TAXAP/743/2010 3/3 JUDGMENT B. Whether the Appellate Tribunal is right in law and on facts in reversing the order passed by CIT(A) and thereby deleting the addition of Rs./ 2,33,840/- made in respect of Sundry Creditors ? C. Whether the Appellate Tribunal is right in law and on facts in reversing the order passed by CIT(A) and thereby deleting the addition of Rs.22,51,000/- made in respect of advance from Ganesh Housing Corporation?

2.

We have heard learned counsel for the parties and we have gone through the record. The Division Bench of this Court in Tax Appeal No.474 of 2010 Commissioner of Income Tax-I vs. Miraa Processors Pvt.Ltd. decided on 11.4.2012, after considering the decision of the Apex Court has held that the assessee has not claimed any cessastion of any kind of liability. Since the order of CIT (Appeals) has been upheld by the Tribunal and finding of fact has been recorded that additions made by the Assessing Officer were rightly deleted by the Commissioner of Income-Tax (Appeals), we are of the considered opinion that these Appeals are concluded by findings of fact and we do not find any error in the order of CIT (Appeals) and the order of the Tribunal. No substantial questions of law arise for consideration in these Appeals. Both these Tax Appeals are accordingly dismissed. However, there shall be no order as to costs.

(V.M.SAHAI,J) (N.V.ANJARIA,J) ***vcdarji

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