THE PR COMMISSIONER OF INCOME TAX, vs. M/S. ASIA POWER PROJECTS PVT. LTD,

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ITA/189/2024HC KarnatakaKAHC01035619202412 February 2025Bench: KRISHNA S DIXIT,G BASAVARAJA4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The Court noted that the subject matter of this appeal was akin to a previous case, ITA No. 329 of 2017, between THE PRINCIPAL COMMISSIONER OF INCOME TAX v. Bangalore International Airport Limited, which was heard and disposed of by a co-ordinate bench of the High Court on September 19, 2022, in favor of the assessee. Furthermore, the Court was informed that the challenge to that order in SLP (Civil) Diary No. 30145 of 2023 had been rejected by the Apex Court on August 14, 2023. The Revenue's submission that the fact matrix of the present case was different from the cognate appeal was found difficult to agree with. Consequently, in view of the binding precedent and the dismissal of the Special Leave Petition, the appeal was liable to be dismissed. No specific findings were given on the substantial questions of law as the appeal was dismissed on the ground of precedent.

What were the facts?

The Revenue, comprising the Principal Commissioner of Income Tax and the Deputy Commissioner of Income-Tax, has filed an appeal under Section 260-A of the Income Tax Act, 1961, challenging an order dated February 27, 2024, passed by the Income-Tax Appellate Tribunal (ITAT), Bengaluru, in ITA No. 1140/Bang/2023. This order pertains to Assessment Year 2017-18. The ITAT's decision confirmed the order of the Appellate Commissioner, which in turn confirmed the order of the Deputy Commissioner. The dispute centers on the assessee's (M/s. Asia Power Projects Pvt. Ltd.) entitlement to set off brought forward book loss in the computation of income under Section 115JB of the Act.

What were the issues?

The Tribunal had to decide the following substantial questions of law: 1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee is entitled to set off brought forward book loss in the computation of income under Section 115JB of the Act, by relying on decisions in M/s. BAIL (ITA No. 622/Bang/2014) and AMLINE TEXTILE (P) LTD. (27 SOT 152), when the said decisions had not reached finality? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee is entitled to set off brought forward book loss in the computation of income under Section 115JB of the Act, when the claim is contrary to the provisions of Section 115JB and Board Circular No. 495 dated September 22, 1987, and ignoring the application of explanation (iii) to the said Section? Assessee's Contentions: The judgment does not record specific contentions made by the assessee. However, the Tribunal's decision implies the assessee argued for the set-off of brought forward book loss under Section 115JB, relying on the cited ITAT decisions. Revenue's Contentions: The Revenue argued that the Tribunal erred in allowing the set-off of brought forward book loss under Section 115JB, questioning the finality of the precedents relied upon by the Tribunal and asserting that the claim is contrary to Section 115JB, Board Circular No. 495, and explanation (iii) to Section 115JB.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 115JB

AI-generated summary — verify with the full judgment below

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NC: 2025:KHC:6294-DB ITA No. 189 of 2024

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF FEBRUARY, 2025 PRESENT THE HON'BLE MR JUSTICE KRISHNA S DIXIT AND THE HON'BLE MR JUSTICE G BASAVARAJA INCOME TAX APPEAL NO. 189 OF 2024 BETWEEN:

1.

THE PR. COMMISSIONER OF INCOME TAX, 5TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU – 560095.

2.

THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-1(1)(1), 2ND FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560 095. …APPELLANTS (BY SRI. Y. V. RAVI RAJ, ADVOCATE)

AND:

M/S. ASIA POWER PROJECTS PVT. LTD, 4 LAKE SIDE RESIDENCY, NO.4, ANNASWAMY MUDALIAR ROAD, BENGALURU-560 042. PAN: AADCA 0485B REP. BY ITS MANAGING DIRECTOR. …RESPONDENT (BY MISS MANASA ANANTHAN, ADV. FOR SMT. TANMAYEE RAJKUMAR, ADVOCATES.

THIS ITA IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 27-02-2024 PASSED ITA NO.1140/BANG/2023 FOR THE ASSESSMENT YEAR 2017-18 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE AND ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME-TAX

Digitally signed by LAKSHMINARAYAN N Location: High Court of Karnataka

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NC: 2025:KHC:6294-DB ITA No. 189 of 2024

APPELLATE TRIBUNAL, BENGALURU IN ITA NO.1140/BANG/2023 DATED 27.02.2024 FOR ASSESSMENT YEAR 2017-2018 ANNEXURE-A CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), BENGALURU AND ETC.

THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR JUSTICE KRISHNA S DIXIT and HON'BLE MR JUSTICE G BASAVARAJA

ORAL JUDGMENT

(PER: HON'BLE MR JUSTICE KRISHNA S DIXIT)

Revenue has challenged the Order dated 27th February, 2024 passed in ITA No.1140/Bang/2023 for the Assessment Year 2017-2018. In the appeal memo, Revenue has framed the following substantial questions of law: "1. Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that assessee is entitled for set off of brought forward book loss in the computation of income under Section 115JB of the Act by relying on decision in the case of M/s. BAIL vide ITA No.622/Bang/2014 and AMLINE TEXTILE (P) LTD. reported in 27 SOT 152 when the said decision has not reached finality?

2.

Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that assessee is entitled for set

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NC: 2025:KHC:6294-DB ITA No. 189 of 2024

off of brought forward book loss in the computation of income under Section 115JB of the Act when the claim is contrary to the provision of Section 115JB and Board Circular No.495 dated 22.09.1987 and ignoring the application of explanation (iii) to the said Section?"

2.

The subject matter of this Appeal is akin to the one in ITA No.329 of 2017 between THE PRINCIPAL COMMISSIONER OF INCOME TAX v. Bangalore INTERNATIONAL AIRPORT LIMITED, heard and disposed by the Co-ordinate Bench of this Court vide order dated 19th September, 2022 in favour of the Assessee.

3.

Learned Counsel appearing for the Assessee notifies to the Court that the challenge to the said order in SLP (Civil) Diary No.30145 of 2023 has been rejected by the Apex Court vide order dated 14th August, 2023. The vehement submission of the learned Panel Counsel for the Revenue that the fact matrix of this case is bit in variance with the one in the cognate appeal, is difficult to agree with.

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NC: 2025:KHC:6294-DB ITA No. 189 of 2024

In view of the above, the appeal is liable to be dismissed and accordingly it is, costs having been made easy.

Sd/- (KRISHNA S DIXIT) JUDGE

Sd/- (G BASAVARAJA) JUDGE

lnn List No.: 1 Sl No.: 29

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