PRINCIPAL COMMISSIONER OF INCOME TAX, SURAT 1 vs. M/S MUKTA ENTERPRISE

We take notice of the fact that the Appellate Tribunal, while dismissing the appeal preferred by the Revenue placed strong reliance on a decision of this Court in the case of " Principal Commissioner of Income Tax v. Alidhra Taxspin Engineers and another rendered in the Tax Appeal No.265 of 2017 dated 2nd May 2017. We may quote para-4 of the decision of this Court referred to above thus : “We have heard Shri Sudhir Mehta, learned advocate appearing on behalf of the revenue. On interpretation of the partnership agreement and considering the wish of the partners reflected in the partnership deed, not to pay/charge interest on the partners capital and the remuneration, the learned tribunal has rightly deleted the disallowance made by the Assessing Officer with respect to the deduction claimed under Section 80IB of the Income Tax Act. As rightly observed by the learned tribunal, mere incorporation of interest on the partners’ capital and remuneration does not signify that the same are mandatory in nature. We concur with the view taken by the learned tribunal. We see no reason to interfere with the impugned judgment and order passed by the learned tribunal. No substantial questions of law arise in the present Tax Appeal. The present Tax Appeal deserves to be dismissed and is accordingly dismissed. ”

Having heard the learned counsel appearing for the C/TAXAP/132/2019 JUDGMENT Revenue and having gone through the materials on record, we are of the view that the issue is squarely covered by the aforesaid decision of this Court.

In our opinion, no error, not to speak of any error of law, could be said to have been committed by the Appellate Tribunal in dismissing the appeal preferred by the Revenue and thereby affirming the order passed by the CIT(A), Surat Bench at Surat."

In the result, this Tax Appeal fails and is hereby dismissed. (J. B. PARDIWALA, J) (A. C. RAO, J) MARY VADAKKAN