CIT v. Karnal Co-operative Sugar Mills Ltd.

243 ITR 2Supreme Court of India2000#822 most cited

What is CIT v. Karnal Co-operative Sugar Mills Ltd. authority for?

Income earned from deposits or investments directly and inextricably linked to the acquisition of assets or the setting up of a business project during its construction period is incidental to the asset acquisition, reducing the project cost, or constitutes business receipts eligible for relevant deductions, rather than 'income from other sources'.

125

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2007 to 2026.

Also referred to as

Karnal Co-operative Sugar Mills · 243 ITR 2 · income during construction · project cost reduction · funds linked to asset acquisition · business income · section 28(1) · section 80IA · section 80IAB · Tuticorin Alkali Chemicals distinguished

Sections most often in play

Section 143(3)Section 234BSection 234CSection 250Section 271(1)(c)Section 28(1)Section 80-IABSection 80IA(4)(iii)

Issues it is cited on

section 112section 111section 114section 57(iii)furnishing inaccurate particulars of incomefurnishing inaccurate particularssection 57section 22section 56income from other sourcessection 271(1)section 37(1)

Judgments citing CIT v. Karnal Co-operative Sugar Mills Ltd.

ITO, New Delhi vs. M/S Triumph Realty Pvt. Ltd., New Delhi

In the result, the appeal is dismissed

ITA 6597/DEL/2016[2012-13]Status: DisposedITAT Delhi29 Nov 2019AY 2012-13

Bench: : Shri Amit Shukla & Shri A.N. Mishraassessment Year: 2012-13

Section 143(3)

…ncome received from the funds which are inextricably linked with setting up of a plant for acquisition of capital asset is a capital receipt. This judgment has also been followed by the Supreme Court in the case of CIT vs. Karnal Cooperative Sugar Mills Ltd., 243 ITR 2 (SC) and CIT vs. Karnataka Power Corporation, 247 ITR 268. Further reliance was also placed on the 5 judgment of Hon’ble jurisdictional High Court in the case of Indian Oil Panipat Power Consortium Ltd. vs. ITO, 315 ITR 255 (Del), wherein the Hon’ble Delhi High Court have even taken note of the judgment of Hon’ble Supreme Court in the case of Tuti…

Pawansut Dwellers Private Limited, Mumbai vs. Income Tax Officer 10(3)(3), Mumbai

The appeal of the assessee is partly allowed for statistical purposes in terms of our aforesaid observations

ITA 317/MUM/2019[2012-13]Status: DisposedITAT Mumbai08 Nov 2019AY 2012-13

Bench: Shri Ravish Sood, Jm & Shri N.K Pradhan, Am

For Appellant: S/shri. Uttam Chand Bothra&
Section 143(1)Section 143(2)Section 143(3)Section 36(1)(iii)Section 37(1)Section 57

…aper Mill India (P) Ltd. (2016) 56 ITR (Trib) 266 (Bang) submitted, that the Tribunal relying on the judgment of the Hon‟ble Supreme Court in the case of CIT Vs. Bokaro Steel Ltd. (1999) 236 ITR 315 (SC) and CIT Vs. Karnal Co-operative Sugar Mills Ltd. (2000) 243 ITR 2 (SC), had observed, that as the interest income earned by the assessee by temporarily parking the share capital meant for meeting the capital expenses in bank deposits was inextricably linked to its capital expenditure, therefore, it was proper to reduce such income from the pre-operative expenses rather than treating it as an item of revenue. The…

ACIT 6(2)(2), Mumbai vs. M/S.Essar Power Orissa Limited, Mumbai

In the result, this appeal is also dismissed

ITA 1504/MUM/2018[2013-14]Status: DisposedITAT Mumbai03 Oct 2019AY 2013-14

Bench: Shri Shamim Yahya & Shri Pawan Singh

For Appellant: Shri Amit Pratap Singh (DR)For Respondent: Shri Vijay Mehta (AR)
Section 143(3)Section 254(1)

…ng Officer treated the same as Income from ‘Other Sources’. The ld. CIT(A) while granting relief to the assessee followed the decision of Hon’ble Supreme Court in CIT vs. Bokaro Steel Ltd. [236 ITR 315 (SC)] and CIT vs. Karnal Co-operative Sugar Mills Ltd. [243 ITR 2(SC), wherein it was held that such interest received partake the character of capital receipt. 7. We have noted that in assessee’s group case in ACIT vs. Essar Power Gujrat Ltd.(supra), in ITA No. 4019,4020/Mum/2016, the coordinate bench of Tribunal in order dated 01.06.2018 on identical grounds of appeal passed the following order: “5.We have…

DCIT, Chennai vs. Indo Tech Transformers Limited, Chennai

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

ITA 1379/CHNY/2017[2006-07]Status: DisposedITAT Chennai16 Sept 2019AY 2006-07

Bench: Shri George Mathan & Shri Inturi Rama Rao

For Appellant: Mr. R.Vijayaraghavan, AdvFor Respondent: Mr. M.S.Nethrapal, JCIT
Section 143(3)Section 14ASection 80I

…of plant by the company, amounts were capital receipts and not income from any independent source. 11) Further, the rationale of judgment of Bokaro Steel Ltd. (supra) was followed in Commissioner of Income Tax vs. Karnal Co-operative Sugar Mills Ltd. (2000) 243 ITR 2 (SC). In this case, the company had deposited certain amount with the bank to open letter of credit for purchase of machinery for setting up plant. On the money so deposited, it earned interest. In that background, this Court observed that this is not a case where any surplus shares capital money which was lying idle had been deposited in the bank…

The Indian Film Combine P.Ltd, Mumbai vs. Principal Commissioner of Income Tax 16, Mumbai

In the result, the appeal of the assessee is hereby ordered to be allowed

ITA 1985/MUM/2019[2014-15]Status: DisposedITAT Mumbai13 Sept 2019AY 2014-15

Bench: Shri M. Balaganesh, Am & Shri Amarjit Singh, Jm आयकर अपील सं/ I.T.A. No.1985/Mum/2019 (ननधधारण वर्ा / Assessment Years: 2014-15) बनधम/ The Indian Film Combine Principal Commissioner Of Income-Tax-16 Pvt. Ltd. Vs. Room No.442, Aayakar 1St Floor, Maker Tower „F‟ Bhawan, M.K. Road, Cuffe-Parade, Mumbai- Mumbai. 400005. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No. :Aaaci3611E (अपीलाथी /Appellant) (प्रत्यथी / Respondent) .. Assessee By: Shri Prakash Jothwani (Ar) Revenue By: Shri Awungshi Gimson (Dr) सुनवाई की तारीख / Date Of Hearing: 06/08/2019 घोषणा की तारीख /Date Of Pronouncement: 13/09/2019 आदेश / O R D E R Per Amarjit Singh, Jm: The Assessee Has Filed The Present Appeal Against The Order Dated 31.01.2019 Passed By The Principal Commissioner Of Income Tax, Mumbai [Hereinafter Referred To As The “Pcit”] Relevant To The A.Y.2014-15 In Which The Principal Commissioner Of Income Tax Has Invoked The Provisions U/S 263 Of The I.T. Act, 1961. 2. The Assessee Has Raised The Following Grounds: - “I. The Principal Commissioner Of Income Tax -16 ("Hereinafter Referred To As The Pcit"), Ignoring The Relevant Facts On Record, Has Erred In Passing Order Under Section 263 Of The Income Tax Act, 1961 By Holding That The Assessment Order Passed By The Ito 16(1)(5) ("Hereinafter Referred To As The Learned Ao") U/S 143(3) Of The Act Dated 26.12.2016 Is Erroneous So As To Be Prejudicial To The Interest Of The Revenue & Directing The Ao To Decide All The Issues Afresh. The Appellant Submits That The Order U/S.263 Of The Act For Modifying The Order U/S.143(3) Of The Act Is Bad In Law, Illegal, Ultra-Virus, In Excess Of And/Or In Want Of Jurisdiction & Otherwise Void. 2. The Pcit Failed To Appreciate That The A.O. While Passing Order U/S 143(3) Has Considered The Facts Of The Case & Had Taken The Legally Correct View. The Pcit Erroneously Observed That There Is At Least Some

For Appellant: Shri Prakash Jothwani (AR)For Respondent: Shri Awungshi Gimson (DR)
Section 143(1)Section 143(2)Section 143(3)Section 263

…off against the preoperative expenses. However, in this regard, the Ld. Representative of the assessee has relied upon the decision of the Indian Oil Panipat Power Const. Ltd. (315 ITR 255)(Del), Bokaro Steel Ltd. (236 ITR 315) (SC), Karnal Co-op. Sugar Ltd. (243 ITR 2)(SC) & Gujarat Power Corpn. Ltd. (354 ITR 201)(Guj). The legal proposition is not in dispute. But this fact came into notice that the issue has been examined by AO while passing the order u/s 143(3) of the Act. The reply was given vide letter dated 16.08.2016, 30.11.2016 & 09.12.2016 lies at page no. 52 to 59 of the paper book. The specific reply t…

Volkswagen India Private Ltd., Pune vs. Assistant Commissioner of Income-Tax

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 1883/PUN/2013[2008-09]Status: DisposedITAT Pune05 Sept 2019AY 2008-09
For Appellant: Shri Danesh BafnaFor Respondent: Shri S.B. Prasad
Section 3Section 4

…income as not taxable under the Act, inter alia, based on any subsequent judicial pronouncement. It is submitted that subsequently, Hon’ble SC in the case of CIT vs. Bokaro Steel Ltd. (1999) 236 ITR 315 (SC) and CIT vs. Karnal Co-operative Sugar Mills (2000) 243 ITR 2 (SC) distinguished the Tuticorin Alkali (supra) decision and held that incidental income earned during the pre-commencement period need not be treated as revenue income if the same is inextricably linked to setting-up of the business and such revenue can be adjusted against the cost of the asset. 3. The Appellant submits that the entire shareholder…

ACIT CC 6(4), Mumbai vs. Arshiya Ltd, Mumbai

In the result the ground of appeal raised by the

ITA 3951/MUM/2015[2007-08]Status: DisposedITAT Mumbai27 Aug 2019AY 2007-08

Bench: Shri G.S. Pannu, Vice- & Shri Pawan Singhacit, Cc-6(4), M/S Arshiya Ltd. Room No. 32(1), Ground 308, Level 3, Ceejay House, Vs. Floor, Aayakar Bhavan, F Block, Shiv Sagar Estate, M.K. Road, Dr. A.B. Road, Worli, Mumbai-400020 Mumbai-400018. Pan: Aaaci2679A Appellant Respondent Dcit Cc-6(4), M/S Arshiya International Ltd. Room No. 32(1), Ground 7Th Floor, Twin Arcade, Vs. Floor, Aayakar Bhavan, C Wing, Military Road, M.K. Road, Marol Maroshi, Andheri (E), Mumbai-400020 Mumbai-400059. Pan: Aaaci2679A Appellant Respondent M/S Arshiya Ltd. [Formerly Dcit Cc-6(4), Known As Arshiya International Room No. 32(1), Ground Vs. Ltd.] 3021, Ceejay House, Floor, Aayakar Bhavan, Level-3, Shiv Sagar Estate, M.K. Road, F-Block, Dr. A.B. Road, Mumbai-400020 Worli, Mumbai-400018. Pan: Aaaci2679A Appellant Respondent M/S Arshiya Ltd. [Formerly Dcit Cc-6(4), Known As Arshiya International Room No. 32(1), Ground Vs. Ltd.] 3021, Ceejay House, Floor, Aayakar Bhavan, Level-3, Shiv Sagar Estate, M.K. Road, F-Block, Dr. A.B. Road, Mumbai-400020 Worli, Mumbai-400018. M/S Arshiya International Ltd.

For Appellant: Shri Mukundraj Chare
Section 143(3)Section 147Section 14ASection 254(1)Section 68Section 69C

…receipt and not the income from independent sources. In support the submission, the ld. AR relied upon the decisions of CIT vs. Bokaro Steel Ltd. 236 ITR 315 (SC), Indian Panipat Power Consortium vs. ITO (315 ITR 255, CIT vs. Karnal Co-op Sugar Mills Ltd. (243 ITR 2) and PCIT vs. Facor Power Ltd. (380 ITR 474). 52. We have considered the rival submission of both the parties and perused the record. During the assessment Assessing Officer has noted that assessee has M/s Arshiya International Ltd. earned interest income of Rs. 13,40,444/- on capital advances made and the said interest income was reduced from WIP…

Solarfield Energy Pvt. Ltd., Mumbai vs. ITO Ward 2(3)(3), Mumbai

In the result, appeal filed by the assessee is allowed

ITA 5189/MUM/2016[2012-13]Status: DisposedITAT Mumbai16 Jul 2019AY 2012-13

Bench: Shri Pawan Singh & Shri M Balaganesh

Section 143(3)Section 154

…assessee for setting up the plant and machinery. Thus, the interest was a capital receipt which would go to reduce the cost of the asset and Ld AR relied on the decision of Hon'ble Supreme Court in the case of CIT v.Karnal Co-operative Sugar Mills Ltd (2000) 243 ITR 2 (SC) and C.I.T. Vs. Bokaro Steel Limited (1999)~236 ITR 315JSCI. 9. From the aforesaid discussion, we find that the assessee has made some income during the period of trial run and the same was adjusted against the pre-operative expenses. The AO rejected the working of assessee and held that the income generated during the trial run income period c…

JCIT(OSD), Cir-11(1), Kolakata, Kolkata vs. M/S Krm International Ltd., Kolkata

ITA 1314/KOL/2016[2005-2006]Status: DisposedITAT Kolkata03 May 2019AY 2005-2006

Bench: Shri S.S.Godara & Dr. A.L. Saini

Section 143(3)

…आयकर अपील"य अधीकरण, "यायपीठ – “C” कोलकाता, IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH “C” KOLKATA Before Shri S.S.Godara, Judicial Member and Dr. A.L. Saini, Accountant Member ITA No.1311-1314/Kol/202016 Assessment Years :1998-99, 2003- 04 to 2005-06 JCIT(OSD), Circle-11(1), V/s. M/s KRM International Ltd., P-7, Chowringhee Square, 46/1B, Ballygunge Place, Kolakta-700069 New Gariahat, Ground Floor, Kolkata-19 [PAN No.AAABCK 2132 P] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Sheetal Khemka, FCA आवेदक क" ओर से/By Assessee Shri Robini Choudhury, Addl. CIT-DR राज"व क" ओर से/By Revenue 04-02-2019 सुनवाई क" त…

JCIT(OSD), Cir-11(1), Kolakata, Kolkata vs. M/S Krm International Ltd., Kolkata

ITA 1313/KOL/2016[2004-05]Status: DisposedITAT Kolkata03 May 2019AY 2004-05

Bench: Shri S.S.Godara & Dr. A.L. Saini

Section 143(3)

…आयकर अपील"य अधीकरण, "यायपीठ – “C” कोलकाता, IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH “C” KOLKATA Before Shri S.S.Godara, Judicial Member and Dr. A.L. Saini, Accountant Member ITA No.1311-1314/Kol/202016 Assessment Years :1998-99, 2003- 04 to 2005-06 JCIT(OSD), Circle-11(1), V/s. M/s KRM International Ltd., P-7, Chowringhee Square, 46/1B, Ballygunge Place, Kolakta-700069 New Gariahat, Ground Floor, Kolkata-19 [PAN No.AAABCK 2132 P] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Sheetal Khemka, FCA आवेदक क" ओर से/By Assessee Shri Robini Choudhury, Addl. CIT-DR राज"व क" ओर से/By Revenue 04-02-2019 सुनवाई क" त…

JCIT(OSD), Cir-11(1), Kolakata, Kolkata vs. M/S Krm International Ltd., Kolkata

ITA 1312/KOL/2016[2003-2004]Status: DisposedITAT Kolkata03 May 2019AY 2003-2004

Bench: Shri S.S.Godara & Dr. A.L. Saini

Section 143(3)

…आयकर अपील"य अधीकरण, "यायपीठ – “C” कोलकाता, IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH “C” KOLKATA Before Shri S.S.Godara, Judicial Member and Dr. A.L. Saini, Accountant Member ITA No.1311-1314/Kol/202016 Assessment Years :1998-99, 2003- 04 to 2005-06 JCIT(OSD), Circle-11(1), V/s. M/s KRM International Ltd., P-7, Chowringhee Square, 46/1B, Ballygunge Place, Kolakta-700069 New Gariahat, Ground Floor, Kolkata-19 [PAN No.AAABCK 2132 P] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Sheetal Khemka, FCA आवेदक क" ओर से/By Assessee Shri Robini Choudhury, Addl. CIT-DR राज"व क" ओर से/By Revenue 04-02-2019 सुनवाई क" त…

JCIT(OSD), Cir-11(1), Kolakata, Kolkata vs. M/S Krm International Ltd., Kolkata

ITA 1311/KOL/2016[1998-99]Status: DisposedITAT Kolkata03 May 2019AY 1998-99

Bench: Shri S.S.Godara & Dr. A.L. Saini

Section 143(3)

…आयकर अपील"य अधीकरण, "यायपीठ – “C” कोलकाता, IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH “C” KOLKATA Before Shri S.S.Godara, Judicial Member and Dr. A.L. Saini, Accountant Member ITA No.1311-1314/Kol/202016 Assessment Years :1998-99, 2003- 04 to 2005-06 JCIT(OSD), Circle-11(1), V/s. M/s KRM International Ltd., P-7, Chowringhee Square, 46/1B, Ballygunge Place, Kolakta-700069 New Gariahat, Ground Floor, Kolkata-19 [PAN No.AAABCK 2132 P] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Sheetal Khemka, FCA आवेदक क" ओर से/By Assessee Shri Robini Choudhury, Addl. CIT-DR राज"व क" ओर से/By Revenue 04-02-2019 सुनवाई क" त…

Karanja Terminal & Logistics P. Ltd, Mumbai vs. DCIT Cen Cir 6(3), Mumbai

The appeal of the assessee is allowed

ITA 2472/MUM/2018[2013-14]Status: DisposedITAT Mumbai20 Mar 2019AY 2013-14

Bench: Shri Rajesh Kumar, Hon'Ble Accountantmember & Shri Ramlal Negi, Hon'Ble Judicialmember

For Appellant: Shri J.P. BairagraFor Respondent: Shri B. Srinivas
Section 115JSection 147Section 148

…evelopment of port terminal at Karanja Creek. In defense of his arguments the ld AR relied on the following decisions: a) CIT Vs Bokaro Steel Ltd 236 ITR 315(SC) b) Indian Panipat Powe Consortium Ltd Vs ITO 315 ITR 255 c) CIT Vs Karnal Coop. Sugar Mills Ltd. 243 ITR 2 (SC) d) PCIT Vs Facor Power Ltd 380 ITR 474 (Delhi) M/s. Karanja Terminal & Logistics Pvt. Ltd., e) NTPC Sail Power Company (P) Ltd. CIT 210 Taxman 358 (Delhi) f) CIT Vs Sasan Power Ltd 205 Taxman 56 (Delhi) g) Adani Power Ltd. Vs ACIT 155 taxmann.com 239(Delhi) h) Solarfield Energy Two Pvt Ltd Vs ITO 5076/Mum/2016 AY 2012-13 dt 11.9.2017 10. The l…

The ITO, Ward-1(1), Ahmedabad vs. M/S. Adani Power Rajasthan Ltd., Ahmedabad

In the result, cross objection of the assessee on this score stands allowed

ITA 1430/AHD/2015[2011-12]Status: DisposedITAT Ahmedabad18 Jan 2019AY 2011-12

Bench: Shri Pradip Kumar Kedia & Shri Mahavir Prasad, Judicial Memebr आयकर अपील सं./I.T.A. No. 1430/Ahd/2015 With Cross Objection No. 114/Ahd/2015 ("नधा"रण वष" / Assessment Year : 2011-12)

For Appellant: Parin Shah, A.RFor Respondent: Shri Mudit Nagpal, Sr. D.R
Section 56

…- 9 - to This establishes the nexus ratio of the Hon'ble Apex Court decision in Bokaro Steel Ltd. (supra) the interest receipt should go on to reduce the cost of construction/development of the power plant. (ii) CIT vs. Karnal Co-operative Sugar Mills Ltd., 243 ITR 2 (SC) The relevant part of this decision is reproduced below: "1. Leave granted. 2. In the present case, the assessee had deposited money to open a letter of credit for the purchase of the machinery required for setting up its plant in terms of the assessee's agreement with the supplier. It was on the money so deposited that some interest has been…

M/S Harbhajan Singh & Co., Sangrur vs. DCIT, Circle, Sangrur

Appeal of the Assessee is dismissed

ITA 727/CHANDI/2018[2012-13]Status: DisposedITAT Chandigarh29 Nov 2018AY 2012-13
For Appellant: Shri. Sanket SinglaFor Respondent: Smt. Chandrakanta
Section 143

…e setting up of the capital structure of the assessee- companv. They must, therefore, be viewed as capital receipts going to reduce the cost of construction." 15. In this context, we may refer witfr profit to CIT v. Karnal Co-operative Sugar Mills Ltd.[2000] 243 ITR 2/[2001] 118 Taxman 489 (SC) wherein the assessee had deposited money to open a letter of credit for the purchase of the machinery required for setting up its plant in terms of the assessee's agreement with the supplier. It was on the money so deposited that some interest had been earned. In that factual backdrop, the apex court ruled thus: "This is…

I.T.O. Ward -1(1), Raipur (Cg) vs. M/S Cmdc Icpl Coal Ltd, Raipur (Cg)

In the result, the appeal of the assessee is allowed

ITA 271/BIL/2014[2011-12]Status: DisposedITAT Raipur12 Oct 2018AY 2011-12

Bench: Shri R. K. Panda & Ms. Suchitra Kambleassessment Year : 2011-12 Ito, Ward- 1(1), Cmdc Icpl Coal Ltd., Raipur (Cg). Rajbandha Maidan, G. E. Road, Vs. Raipur (Cg).

For Appellant: Shri R. B. Doshi, CAFor Respondent: Shri Ajit Kumar Laskar, DR

…ucture. The Hon'ble High Court while holding so considered the decision of the Hon’ble Supreme Court in the case of (supra) and various other decisions. We find the Hon'ble Supreme Court in the case of CIT vs. Karnal Co-operative Sugal Mills Ltd. reported in 243 ITR 2 following the decision in the case of Bokaro Steel Ltd. (supra) has observed as under :- “In the present case, the assessee had deposited money to open a letter of credit for the purchase of the machinery required for setting up its plant in terms of the assessee's agreement with the supplier. It was on the money so deposited that some interest h…

Mjsj Coal Limited, Angul vs. ITO, Ward-1(3), Bhubaneswar

Appeals of the assessee are allowed

ITA 107/CTK/2018[2014-15]Status: DisposedITAT Cuttack31 Aug 2018AY 2014-15

Bench: Shri N.S.Saini, Am & Shri Pavan Kumar Gadale, Jm आयकर अपील सं./Ita Nos.429/Ctk/2016, 68/Ctk/2017 & 107/Ctk/2018 ("नधा"रण वष" / A.Ys :2011-2012, 2013-2014 & 2014-2015) Mjsj Coal Limited, Vs. Ito, Ward-2, Dhenkanal / At/Po:Balanda, Talcher, Ito, Ward-1(3), Bhubaneswar Dist-Angul, Odisha-759116 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aagcm 1095 E (अपीलाथ" /Appellant) (""यथ" / Respondent) .. "नधा"रती क" ओर से /Assessee By : Shri K.K.Bal, Ar राज"व क" ओर से /Revenue By : Shri Subhendu Dutta, Citdr सुनवाई क" तार"ख / Date Of Hearing : 28/08/2018 घोषणा क" तार"ख/Date Of Pronouncement 31/08/2018 आदेश / O R D E R Per Shri Pavan Kumar Gadale, Jm: These Are The Appeals Filed By The Assessee Against The Separate Orders Of Cit(A)-1&3, Bhubaneswar, Dated 28.04.2016, 04.11.2016 & 04.12.2017 Passed In I.T.Appeal Nos.0120/2014-15, 0472/15-16 & 0254/16-17, For The Assessment Years 2011-2012, 2013-2014 & 2014- 2015. 2. Since Issues The Above Appeals Are Common, Therefore, They Are Heard Together & Disposed Off By This Consolidated Order. For The Sake Of Convenience We Shall Take Up Assessee’S Appeal I.E. Ita No.429/Ctk/2016 For Assessment Year 2011-2012 & The Grounds & Facts Mentioned Therein, Wherein The Assessee Has Raised The Following Grounds Of Appeal :- Ground Of Appeal • We Are Not Agreeing With The Computation Of Tax On Interest Earn By Company Made By Assessing Officer. • During The Assessment, The Cases We Submitted To Justify Our Claim (As Mentioned In Statement Of Facts) Has Not Been Paid Any Emphasis For Deciding The Case By The A.0 & Cit (Appeal- 3),Bhubaneswar. On The Other Hand The A.0 & Cit (Appeal-3) Finally Imposed His Decision Based On The Facts Of Alkali Tuticorin Chem. & Fertilizers Ltd. In Which It Has Earned Interest On The Funds, Were Borrowed Funds Only

For Appellant: Shri K.K.Bal, ARFor Respondent: Shri Subhendu Dutta, CITDR

…he amounts were directly connected to and capital receipts and not income from any independent source. 11. Further, the rationale of judgment of Bokaro Steel Ltd. (supra) was followed in CIT v. Karnal Co-operative Sugar Mills Ltd. [2001] 118 Taxman 489/[2000] 243 ITR 2 (SC). In this case, the company had deposited certain amount with the bank to open letter of credit for purchase of machinery for setting up plant. On the money so deposited, it earned interest. In that background, this Court observed that this is not a case where any surplus shares capital money which was lying idle had been deposited in the bank…

Mjsj Coal Limited, Angul vs. ITO, Ward-2, Dhenkanal

Appeals of the assessee are allowed

ITA 429/CTK/2016[2011-12]Status: DisposedITAT Cuttack31 Aug 2018AY 2011-12

Bench: Shri N.S.Saini, Am & Shri Pavan Kumar Gadale, Jm आयकर अपील सं./Ita Nos.429/Ctk/2016, 68/Ctk/2017 & 107/Ctk/2018 ("नधा"रण वष" / A.Ys :2011-2012, 2013-2014 & 2014-2015) Mjsj Coal Limited, Vs. Ito, Ward-2, Dhenkanal / At/Po:Balanda, Talcher, Ito, Ward-1(3), Bhubaneswar Dist-Angul, Odisha-759116 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aagcm 1095 E (अपीलाथ" /Appellant) (""यथ" / Respondent) .. "नधा"रती क" ओर से /Assessee By : Shri K.K.Bal, Ar राज"व क" ओर से /Revenue By : Shri Subhendu Dutta, Citdr सुनवाई क" तार"ख / Date Of Hearing : 28/08/2018 घोषणा क" तार"ख/Date Of Pronouncement 31/08/2018 आदेश / O R D E R Per Shri Pavan Kumar Gadale, Jm: These Are The Appeals Filed By The Assessee Against The Separate Orders Of Cit(A)-1&3, Bhubaneswar, Dated 28.04.2016, 04.11.2016 & 04.12.2017 Passed In I.T.Appeal Nos.0120/2014-15, 0472/15-16 & 0254/16-17, For The Assessment Years 2011-2012, 2013-2014 & 2014- 2015. 2. Since Issues The Above Appeals Are Common, Therefore, They Are Heard Together & Disposed Off By This Consolidated Order. For The Sake Of Convenience We Shall Take Up Assessee’S Appeal I.E. Ita No.429/Ctk/2016 For Assessment Year 2011-2012 & The Grounds & Facts Mentioned Therein, Wherein The Assessee Has Raised The Following Grounds Of Appeal :- Ground Of Appeal • We Are Not Agreeing With The Computation Of Tax On Interest Earn By Company Made By Assessing Officer. • During The Assessment, The Cases We Submitted To Justify Our Claim (As Mentioned In Statement Of Facts) Has Not Been Paid Any Emphasis For Deciding The Case By The A.0 & Cit (Appeal- 3),Bhubaneswar. On The Other Hand The A.0 & Cit (Appeal-3) Finally Imposed His Decision Based On The Facts Of Alkali Tuticorin Chem. & Fertilizers Ltd. In Which It Has Earned Interest On The Funds, Were Borrowed Funds Only

For Appellant: Shri K.K.Bal, ARFor Respondent: Shri Subhendu Dutta, CITDR

…he amounts were directly connected to and capital receipts and not income from any independent source. 11. Further, the rationale of judgment of Bokaro Steel Ltd. (supra) was followed in CIT v. Karnal Co-operative Sugar Mills Ltd. [2001] 118 Taxman 489/[2000] 243 ITR 2 (SC). In this case, the company had deposited certain amount with the bank to open letter of credit for purchase of machinery for setting up plant. On the money so deposited, it earned interest. In that background, this Court observed that this is not a case where any surplus shares capital money which was lying idle had been deposited in the bank…

Eco Axis Systems P.Ltd, Mumbai vs. DCIT RG 2(1), Mumbai

In the result, the appeal is partly allowed

ITA 730/MUM/2013[2008-09]Status: DisposedITAT Mumbai10 Aug 2018AY 2008-09

Bench: Shri C N Prasad & Shri Rajesh Kumarassessment Year : 2008 - 09 M/S. Eco Axis Systems Private Dy Cit Range 2(1), Limited, Mumbai Vs. 43, Dr. V B Gandhi Marg, Fort, Mumbai 400 023. Pan Aaacf8154H (Appellant) (Respondent)

For Appellant: Shri Nitesh Joshi & Shri Mihir ShahFor Respondent: Shri V Justin
Section 143(3)

…ssessee for setting up the plant and machinery. Thus, the interest was a capital receipt which would go to reduce the cost of the asset and Ld AR relied on the decision of Hon’ble Supreme Court in the case of CIT v. Karnal Co-operative Sugar Mills Ltd. (2000) 243 ITR 2 (SC) and C.I.T. Vs. Bokaro Steel Limited.(1999) 236 ITR 315 (SC) 9. From the aforesaid discussion, we find that the assessee has made some income during the period of trial run and the same was adjusted against the pre-operative expenses. The AO rejected the working of assessee and held that the income generated during the trial run income period…

The Pr Commissioner of Income Tax vs. M/S Bank Note Paper Mill India Pvt Ltd

ITA/690/2017HC Karnataka21 Jun 2018

Bench: S.SUJATHA,VINEET KOTHARI

Section 260

…nnected with or incidental to working of construction of the assessee’s plant. The decision of the Hon’ble Supreme Court in the case of Bokaro Steel Ltd. (supra) was followed subsequently in the case of CIT vs. Karnal Co- operative Sugar Mills Ltd. (243 ITR 2). An identical issue had come up for consideration before the Hon’ble Jurisdictional High Court in the case of CITA vs. Karnataka State Agricultural Produce Processing and Export Corporation Ltd. (377 ITR 496). In that case the State Government Date of Judgment 21-06-2018, ITA No.690/2017 The Pr. Commissioner of Income Tax CIT(A) & anothe…