THE COMMISSIONER OF INCOME TAX,KOTTAYAM vs. M/S.ACCELERATED FREEZE DRYING CO.LTD.

IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT:- THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN

& THE HONOURABLE MR. JUSTICE ASHOK MENON THURSDAY, THE 2ND DAY OF AUGUST 2018 / 11TH SRAVANA, 1940

I.T.A.No.201 of 2010 ---------------------------- AGAINST THE ORDER IN I.T.A.NO.1286/COCH/2005& CO NO.25/COCH/06 DATED 13.11.2009 OF THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, COCHIN. [ASSESSMENT YEAR 2002-03]. -------------------- APPELLANT(S)/ APPELLANT:- -------------------------------------------- COMMISSIONER OF INCOME TAX, KOTTAYAM. BY SENIOR COUNSEL FOR GOVERNMENT OF INDIA (TAXES) SRI.P.K.R.MENON BY ADV.SRI.JOSE JOSEPH, SC, FOR INCOME TAX. RESPONDENT(S)/ RESPONDENT:- -------------------------------------------------- M/S. ACCELERATED FREEZE DRYING CO. LTD., ALAPPUZHA. R1 BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR R1 BY ADV. SRI.P.GOPINATH R1 BY ADV. SRI.P.BENNY THOMAS R1 BY ADV. SRI.K.JOHN MATHAI R1 BY ADV. SRI.JOSON MANAVALAN R1 BY ADV. SRI.KURYAN THOMAS

THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 02-08-2018, ALONG WITH I.T.A.NO.281 OF 2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:-

I.T.A.NO.201 OF 2010 APPENDIX APPELLANT(S)' ANNEXURES:- --------------------------------------------- ANNEXURE-A ASSESSMENT ORDER U/S.143(3) R.W.S.147 DATED 16.903.2004. ANNEXURE-B ORDER OF THE CIT(A), KOCHI IN ITA-10/APY/CIT(A)-IV/04-05 DATED 13.03.2008. ANNEXURE-C ITAT's ORDER IN ITA NO.541/COCH/2008 DATED 14.07.2009. ADDITIONAL ANNEXURE-D TRUE COPY OF ASSESSMENT ORDER DATED 21.02.2005. ADDITIONAL ANNEXURE-E TRUE COPY OF THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) DATED 10.10.2005. RESPONDENT(S)' ANNEXURES:- ------------------------------------------------ NIL. vku/- [ true copy ]

K. Vinod Chandran & Ashok Menon, JJ. ------------------------------------------------------- I.T.A.Nos.201 & 281 of 2010 ------------------------------------------------------- Dated, this the 02nd day of August, 2018 JUDGMENT Vinod Chandran, J: The common order of the Tribunal from which arises both these appeals, is a classic illustration of how an order of the Tribunal, the last fact finding authority, should not be. 2. There are four questions raised in both the appeals. In the appeal on assessment, being I.T.A.No.201 of 2010, there are three issues - (i) the disallowance of interest accrued to the Bank, (ii) interest disallowed on diversion of borrowed funds to sister concerns and (iii) whether the Foreign Exchange loss is a permissible deduction. In I.T.A.No.281 of 2010, arising from a re-assessment proceedings, the issue is of capital gains on transfer of undertaking. A reading of the Tribunal order indicates that they have not looked into the facts and without any application of mind found in favour of the assessee merely quoting judgments without applying them to the facts of the case. We specifically notice that the appeals are of the year 2010 and the same were pending here for the last eight years. If we go ahead to consider the appeals, then we would be assuming

ITA.Nos.201 & 281 of 2010 - 2 - the role of the Tribunal, which is the last fact finding authority. Only in such circumstances, we would remand the issue to be considered by the Tribunal. We have to notice while remanding the matter that, there is a Cross Objection filed by the Revenue; against which there is no appeal filed. In fact, all the questions were found against the assessee, by the assessing authority and the first appellate authority. In such circumstances, the Cross Appeal would stand rejected as unnecessary and such rejection would not affect the consideration of the appeal by the assessee. The common impugned order is set aside. Especially noticing the long pendency, we request the Tribunal to dispose of the appeals within a period of six months from the date of receipt of a certified copy of this judgment. The parties are directed to appear before the Tribunal on 20.08.2018. The appeals are disposed of as above. No costs. Sd/- K.Vinod Chandran Judge

Sd/-

Ashok Menon vku/- Judge [ true copy ]