M/S. CHAMUNDI POLYMERS PVT. LTD.,BANGALORE vs. COMMISSIONER OF INCOME TAX, BANGALORE

O R D E R

Per Shri A.K. Garodia, Accountant Member

by the assessee are as under. “1. The order of the Commissioner of Income-tax [Appeals] in so far as they are against the appellant are opposed to law, equity, and weight of evidence, probabilities, facts and circumstances of the case.

2. The appellant denies itself liable to be assessed at a reduced carry forward of unabsorbed deprecation of Rs. 5,40,786/- as against the actual claim of carry forward of unabsorbed deprecation of Rs. 28,34,688 /- under the facts and circumstances of the case.

3. The learned authorities below were not justified in law and on facts in making an addition of Rs. 22,73,908/- by invoking the provisions of section 41 [1] of the Act under the facts and circumstances of the case.

4. The learned CIT [A] erred in confirming the additions under section 41 [1] of the Act made by the learned assessing officer of Rs. 20,43,214/- which was arbitrarily arrived under the facts and circumstances of the case.

5. The learned authorities below failed to appreciate the fact that the said amount of Rs. 20,43,214/- was never allowed in any earlier Page 2 of 3 assessment year, as the same is not deemed to have not actually paid as per provisions of Explanation 3C to 43B of the Act under the facts and circumstances of the case.

6. The learned authorities below failed to appreciate the fact that a sum of Rs 1,54,685/- is nature of capital receipt and consequently the provisions of section 41 [1] of the Act is not applicable to the items which are capital in nature under the facts and circumstances of the case.

9. For the above and other grounds that may be urged at the time of hearing of the appeal, the Appellant prays that the appeal may be allowed and justice rendered.”

3. It was submitted by ld. AR of assessee that as per ground no. 3 raised before ld. CIT(A), this was the grievance raised by assessee before ld. CIT(A) that AO has ignored the entire records and facts available on record for the Assessment Year 1990-91 to 2004-05 and has not considered the facts of the case and correlated the same with the assessee’s explanation given in its letter dated 19.12.2008. He submitted that ld. CIT(A) has not decided the issue after considering this issue raised in ground no. 3 of appeal raised before ld. CIT(A) and hence, in the interest of justice, the matter may be restored back to the file of ld. CIT(A) for fresh decision after considering various aspects raised in ground no. 3 raised before ld. CIT(A). The ld. DR of revenue supported the order of ld. CIT(A).

4. We have considered the rival submissions. First of all, we reproduce ground no. 3 raised by assessee before ld. CIT(A). The same is as under. “3. The LAO has ignored the entire records and facts available on record for the A/Y 1990-91 to 2004-05 and has not considered the facts of the case and correlate the same with the appellants explanation given in its letter dt. 19-12-2008.”

Page 3 of 3 5. The issue in dispute is regarding the benefit availed by the assessee on account of one-time settlement in respect of payment of term loan and interest amount over a period of time with Karnataka State Finance Corporation Ltd. Hence, in our considered opinion, the various factual aspects raised by assessee in ground no. 3 raised before ld. CIT(A) as reproduced above should have been considered by ld. CIT(A) for deciding this issue. But as per the impugned order of ld. CIT(A), this aspect has not been considered by him and therefore, we feel it proper to restore the entire matter back to the file of ld. CIT(A) for fresh decision after considering the various aspects raised by assessee in ground no. 3 before ld. CIT(A). We order accordingly. In view of this decision, no further adjudication on merit is called for at the present stage. We do not make any comment on the merit of the case.