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1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF JULY, 2018 PRESENT THE HON’BLE Dr.JUSTICE VINEET KOTHARI AND
THE HON’BLE MRS.JUSTICE S.SUJATHA ITA No.109/2015 Between: 1. The Commissioner of Income-Tax,
C.R.Building,
Queens Road,
Bangalore.
The Deputy Commissioner of Income-Tax,
Circle-1(3)
No.59, HMT Bhavan,
6th Floor, Bellary Road,
Ganganagar,
Bangalore-560 032.
.. Appellants
(By Sri.K.V.Aravind, Advocate)
And:
M/s.Golf View Homes Ltd., No.73/1, 5th Floor, Sheriff Centre, St.Marks Road, Bangalore, PAN:AABCG4059M.
.. Respondent
(By Sri A.Shankar & Sri M.Lava, Advocates)
This ITA is filed under Section 260-A of Income Tax Act 1961, arising out of order dated 21.11.2014, passed in ITA.No.1254/Bang/2012, for the Assessment year 2008- 2009.
Date of Judgment:16.07.2018 in ITA No.109/2015 The Commissioner of Income-Tax and Anr. Vs. M/s Golf View Homes Ltd.,
This ITA coming on for Admission this day, Dr.Vineet Kothari, J., delivered the following: JUDGMENT
Sri.K.V.Aravind, Adv for Appellants. Sri A.Shankar & Sri M.Lava, Advs. for Respondent.
Both the learned counsel have fairly submitted that the present appeal is squarely covered by a decision of Co-ordinate Bench of this Court in ITA.No.29 of 2013, Commissioner of Income Tax & another vs. M/s.Golf View Homes Ltd., wherein it is held in favour of the same present assessee for the earlier year that the interest paid by the assessee on borrowals which were deposited with the firms M/s.Diamond District and M/s.Platinum City, for acquiring property rights in the buildings developed and constructed by them, would be allowable as deduction under Section 36 of the Income Tax Act, while computing the income from business and profits.
Date of Judgment:16.07.2018 in ITA No.109/2015 The Commissioner of Income-Tax and Anr. Vs. M/s Golf View Homes Ltd.,
The relevant portion of the said judgment of the Co-ordinate Bench is quoted below for ready reference. “ Para-13 : The attempt on the part of the revenue to contend that the finding arrived at by the Tribunal is perverse by misconstruing the order of CIT (Appeals) cannot be countenanced for three fold reasons: One is that the department itself before the Tribunal did not dispute the aforesaid finding of fact recorded by CIT (Appeals).
The second is that it is not only at one place the aforesaid finding of fact is recorded but subsequently as observed earlier at two places similar factum is also recorded.
The third is that when such finding of fact was not disputed and was also reiterated by the Commissioner (Appeals) and the said reiteration was also not disputed and
Date of Judgment:16.07.2018 in ITA No.109/2015 The Commissioner of Income-Tax and Anr. Vs. M/s Golf View Homes Ltd.,
the Tribunal has relied upon the same and has proceeded as an undisputed fact, such a view on the part of the Tribunal cannot be said to be perverse view.
When one talks about perversity, the test would be that no reasonable person would take such view. But if the view taken by the Tribunal is a possible reasonable view, such view cannot said to be perverse. If the perversity is tested from the material on record, then also, we cannot accept the contention that the finding of fact so recorded by the Tribunal is perverse or without there being any material on record.
Further attempt made by the learned counsel for the appellant that it is misunderstanding of the order of the Tribunal or the Tribunal has wrongly interpreted the observations made by the CIT (Appeals) also cannot be accepted for two reasons:
One is that had such being the position, nothing prevented the
Date of Judgment:16.07.2018 in ITA No.109/2015 The Commissioner of Income-Tax and Anr. Vs. M/s Golf View Homes Ltd.,
department from raising the dispute for applicability of such finding when the aspect for allowance of the interest under Section 36 of the Act was to be considered.
Another is that, if on one part CIT (Appeals) which allows the claim on the ground that no evidence was produced to show the nexus and on the other part, if CIT (Appeals) does find the activity of the assessee inter alia for acquiring property rights in M/s.Diamond District and M/s.Platinum City, which are sister concerns coupled with the aspect of such reiteration, further at two places, the earlier observations made that there is no independent evidence produced before him would not only result into contradiction in finding but it would also lose its efficacy. In any case, even if two views are possible, the interpretation would lean in favour of the assessee that too when
Date of Judgment:16.07.2018 in ITA No.109/2015 The Commissioner of Income-Tax and Anr. Vs. M/s Golf View Homes Ltd.,
the judicial review is limited to question of law and limited to perversity in any finding of fact. Under such circumstances, the contention raised on behalf of revenue fails.
16.
In view of the aforesaid observations and discussion, we find that the question which is raised by the revenue in the present appeal deserves to be answered in negative, against the revenue and in favour of the assessee by holding that the finding of the Tribunal cannot be said to be perverse.
We find that there is no perversity in the finding of the Tribunal in allowing the appeal of the assessee so far as the deduction of the interest on the loan taken which is utilized for giving advances to the sister concerns i.e., M/s.Diamond District and M/s.Platinum City.
In view of the aforesaid observations and discussion, we find that when the appeal is without any merit and
Date of Judgment:16.07.2018 in ITA No.109/2015 The Commissioner of Income-Tax and Anr. Vs. M/s Golf View Homes Ltd.,
even if too lenient view is taken on the aspect of delay, though it is strongly resisted by the learned counsel for the assessee to condone such long delay of more than 2500 days, delay is condoned but as the main appeal as per reasons recorded by us is meritless, the same is dismissed.”
The present appeal is of subsequent Assessment Year 2008-2009 and there being no other difference of facts, we do not find any reason to take a different view of the matter and accordingly, the present Appeal is disposed of in same terms. No costs.
Sd/- JUDGE
Sd/- JUDGE
bk/ (List No.1 Sl.No.1)