Commissioner Of Income Tax-7 v. M/S. Tracstar Investment Ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.4929 OF 2010 Commissioner of Income Tax-7. ..Appellant. Vs. M/s. Tracstar Investment Ltd., ..Respondent. .... Mr. Suresh Kumar, for the Appellant. Mr. P.J. Pardiwala, Senior Counsel a/w. Mandar Vaidya i/b. Roy's Law Firm, for the Respondent. .... CORAM : J. P. DEVADHAR & A.R. JOSHI, JJ. th DECEMBER, 2011. DATED : 14 P.C. 1.Following questions of law are raised by the Revenue in this appeal. “a) Whether, on the facts and circumstances of the case and in law the Tribunal was justified in allowing the claim of legal expenses of Rs.8,66,650/- when admittedly these expenses were incurred on litigation for other group companies which are not subsidiary companies of the Assessee and as such the decision of the Supreme Court in the case of M/s. S.A. Builders Ltd. (288 ITR 1) was not applicable ? (b) Whether, on the facts and circumstances of the case and in law the Tribunal was justified in allowing the traveling expenses of Rs.15,52,234/- spent by Shri. U.K. Ganguly, director of the assessee held as expense on a foreign visit in connection and sale negotiation and subsidiary company M/s. Bio Foods Pvt. Ltd. which was to be sold to M/s. Burns Philips India Ltd. which is a Calcutta based India Company and no questions arose for a visit abroad for its negotiation and sale ? (c) Whether, on the facts and circumstances of the case and in law the Tribunal was justified in holding that traveling expenses had direct nexus with the activities of the subsidiary company M/s. Bio Foods Pvt. Ltd., when its sale was to be made within India ? (d) Whether, on the facts and circumstances of the case and in law the Tribunal was justified in ignoring the Punjab High Court decision in case of Kam Chandra Munna Lal Vs. CIT (17 ITR 394) which held that any expenses for disposing of the business cannot be said to have been incurred for the purpose of business ? (e) Whether, on the facts and circumstances of the case and in law the Tribunal was justified in allowing interest paid to M/s. Oriental Radios Pvt. Ltd., of Rs.10,50,000/- on loans taken and Rs.1,57,500/- to M/s. Agencial Commercial International on money taken as dealers deposits when the same were invested for acquiring shares of other companies dividend from which receivable by the assessee were exempt from tax? (f) Whether, on the facts and circumstances of the case and in law the Tribunal was justified in treating the income arising from sale and purchase of shares as capital loss when the frequency of the transaction clearly proved that it was a business loss and so should have been treated as speculation loss within the meaning of Section 73 of the I.T. Act, 1961?" 2.As regards questions (a) to (d) are concerned, Counsel for the parties state that similar questions raised by the Revenue in assessee's own case has been rejected by this Court. Hence, questions (a) to (d) cannot be entertained. state that similar question raised by the Revenue in the assessee's own case in Tax Appeal No.1430 of 2011 has been dismissed by this Court. Accordingly, question (e) cannot be entertained. 4.As regards, question (f) is concerned, a finding of fact recorded by the CIT(A) and upheld by the ITAT is that the past record of the assessee do not indicate that the assessee was engaged in the business of trading in shares and accordingly the loss incurred by the assessee on sale of shares cannot be treated as business loss. The decision of the ITAT is based on a finding of fact. Accordingly, question (f) cannot be entertained. 5.In the result, the Appeal is dismissed. (A. R. JOSHI, J.) (J. P. DEVADHAR,J.)