DCIT, NEW DELHI vs. M/S. NEW LINE DEVELOPERS PVT. LTD., NEW DELHI

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ITA 364/DEL/2015Status: DisposedITAT Delhi24 October 2017AY 2011-123 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the order of the CIT(A) by respectfully following a previous precedent from the assessment year 2009-10. This precedent had dismissed the Revenue's appeal on similar facts and circumstances regarding the commitment deposit.

What were the facts?

The Revenue appealed an order by the CIT(A) concerning the assessment year 2011-12. The appeal was filed with a delay of 13 days, which was condoned by the Tribunal. The core issue revolved around whether interest had accrued or was collected on a commitment deposit.

What were the issues?

The key issue was whether the assessee was liable to account for interest on a commitment deposit on an accrual or notional basis, as per the mercantile system of accounting.

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES : E : NEW DELHI

Before: SHRI R.S. SYAL & SHRI KULDIP SINGH

For Appellant: Shri R.M. Mehta, Advocate
For Respondent: Shri Arun Kumar Yadav, Sr. DR
Hearing: 23.10.2017Pronounced: 24.10.2017

ORDER PER R.S. SYAL, VP: This appeal by the Revenue is directed against the order passed by the ld. CIT(A) on 27.10.2014 in relation to the assessment year 2011-12.

2.

There is a delay of 13 days in filing the appeal by the Revenue. The ld. DR explained the reasons with which we are satisfied. The ld. AR did not raise any serious objection to it. We, therefore, condone the delay and admit the appeal for hearing.

3.

The following grounds have been raised in this appeal:-

“1. Whether on the facts and circumstances of the case & in law, the ld.CIT(A) has erred in giving relief amounting to Rs.1,57,56,000/- to the assessee and holding that neither any interest had accrued on the commitment deposit nor any interest is collected by the assessee? 2. Whether on the facts and circumstances of the case & in law, the ld.CIT(A) has erred in not appreciating the facts mentioned by the A.O. in his order that the assessee had full right to recover the demand? 3. Whether on the facts and circumstances of the case & in law, the ld.CIT(A) has erred by ignoring the fact that the assessee is following mercantile system of accounting and as per the provisions of the mercantile system of accounting, any income due to the assessee in the previous year, though may not have actually received shall be added as income on accrual/notional basis? 4. That the order of the ld.CIT(A) is erroneous and is not tenable on facts and in law.

5. That the grounds of appeal are without prejudice to each other.”

4.

We have heard the rival submissions and perused the relevant material on record. It is seen that similar issues were raised in the Revenue’s appeal for the assessment year 2009-10. The Tribunal, vide its order dated 20.03.2017 in has dismissed the Revenue’s appeal upholding the order of the CIT(A) on this issue. The ld. DR candidly admitted that the facts and circumstances of the instant appeal are mutatis mutandis similar to those of assessment year 2009-10.

Respectfully following the precedent, we uphold the impugned order.

5.

In the result, the appeal filed by the Revenue is dismissed.

The order pronounced in the open court on 24.10.2017.

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