C.I.T vs. M/S MODEL LINE COLONISERS

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ITR/139/1996HC Punjab & HaryanaPHHC01034942199610 November 2006Author: MR. JUSTICE AJAY KUMAR MITTAL,MR. JUSTICE RAJESH BINDAL2 pages
AI SummaryAllowed

What did the High Court hold?

The High Court of Punjab and Haryana at Chandigarh, while considering the referred question of law, relied on its previous judgment rendered on 29.09.2006 in the case of Commissioner of Income Tax, Patiala v. M/s Dhir & Co. Colonisers (P) Limited, Ludhiana (ITR Nos.102 to 104 of 1990). In that judgment, the Court had extensively examined the issue and answered the question in favour of the revenue and against the assessee. Consequently, following this precedent, the High Court answered the present question of law in favour of the revenue and against the assessee. The operative direction is to answer the question in favour of the revenue.

What were the facts?

The Income Tax Appellate Tribunal (ITAT), Chandigarh Bench, passed an order dated 23.01.1995 in I.T.A. No.189/Chandi/1990 concerning assessment year 1986-87. The Commissioner of Income-tax, Patiala (the applicant/revenue) sought a reference to the High Court of Punjab and Haryana at Chandigarh on a specific question of law arising from the ITAT's order. The assessee is M/s Model Line Colonisers (P) Ltd., Ludhiana. The dispute pertains to whether amounts received in installments on account of the sale of plots by the assessee, who is a coloniser, are to be treated as trading receipts.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in holding that amounts received in instalments on account of sale of plots by the assessee who is a coloniser are not its trading receipts? (Question of law) Assessee's contentions: Not recorded in the judgment. Revenue's contentions: Not recorded in the judgment, but the reference to the High Court implies disagreement with the ITAT's finding.

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** I.T.R. No.139 of 1996 Date of Decision:10.11.2006 Commissioner of Income-tax, Patiala .....Applicant Vs. M/s Model Line Colonisers (P) Ltd., Ludhiana .....Respondent CORAM:- HON'BLE MR. JUSTICE AJAY KUMAR MITTAL HON'BLE MR. JUSTICE RAJESH BINDAL Present:- Mr. S.K.Garg Narwana, Advocate for the applicant. ****

JUDGMENT Following question of law has been referred for opinion of this Court by the Income Tax Appellate Tribunal, Chandigarh Bench, Chandigarh arising out of its order dated 23.1.1995 in I.T.A. No.189/Chandi/1990 in respect of assessment year 1986-87:- “Whether, on the facts and in the circumstances of the case, the ITAT was right in law in holding that amounts received in instalments on account of sale of plots by the assessee who is a coloniser are not its trading receipts?” The question referred has been gone into by this Court in judgment rendered on 29.09.2006 in Commissioner of Income Tax, Patiala v. M/s Dhir & Co. Colonisers (P) Limited, Ludhiana ITR Nos.102 to 104 of 1990 and after considering the issue at length, the question has been answered in favour of the revenue and against the assessee. Following the above judgment, we answer the question raised in favour of the revenue and against the assessee.

( AJAY KUMAR MITTAL ) JUDGE November 10, 2006 ( RAJESH BINDAL ) renu JUDGE

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