Ita/356/2007 Of The Commissioner Of Income Tax v. M/S United Breweries Ltd

IN THB HIGH COURT OF KARNATAKA AT BANGALORE DATED THIS THE 28[‘T]DAY OF JANUARY 2014 PRESENT THERE HON'BLE MR.JUSTICE DILIP B.BHOSAL AN D THR HON'BLBE MR..JUSTICBK B.MANOHA ITA NO.356/2007 BBRITWRE 1. The Commissioner of Income Tax,Central Circle,C.R.Building, Queens Road,Bangalore. 2. The Assistant Commissioner of Income Tax,Central Circle -2 (3),C.R.Building, Queens Road,Bangalore... Appellant (By Sri.K.V.Aravind, Advocate) AND: M/s.United Breweries Ltd., No.1/1, Vittal Mallya Road,Bangalore — 560 OO1..... Responde (By Smt.S.R.Anuradha, Advocate) This ITA is filed u/S.260-A of I.T Act, 1961 arisingOUToT|Orderdated15-09-2006|passedInITANo.3043/Bang/2004 for the Assessment Year 2000-01,praying that this Hon’ble Court may be pleased to 1.formulate the substantial questions of law|stated therein.stated therein. 11.Allow the appeal and set aside the order passedbytheITAT,Bangalore|in.bytheITAT,Bangalore|in. ITA.No.3043/Bang/ 2004dated15-09-2006confirmingtheorderoT|theAppellateCommissioner and confirm the order passed by|the Asst. Commissioner of Income Tax, Central|Circle-2(3), Bangalore, in the interest of justice|and equity.confirmingtheorderoT|theAppellateCommissioner and confirm the order passed by|the Asst. Commissioner of Income Tax, Central|Circle-2(3), Bangalore, in the interest of justice|and equity. This appeal coming on for hearing this day,DILIPB. BHOSALE J.,delivered the following: P.C. This income tax appeal is directed against theorder dated 15[2%]september 2006 rendered by theIncome Tax Appellate Tribunal, Bangalore Bench ‘A’ (forshort‘theTribunal’) InITANo.3043/Bang/2004whereby the Tribunal confirmed the order of the Commissioner of Income Tax (Appeals)-VI, Bangalore(for|short‘the.FirstAppellateAuthority) dated | 23-07-2004 for the assessment year 2000-01. The respondent-assessee had filed an appeal before the First Appellate Authority against the order of assessmentdated 24-03-2003. 2 |In this appeal, the revenue has raised the following substantial questions of law: (i). Whether the Tribunal was correct inholding that a sum of Rs.5.57 crores|SpentOrnmaintenanceof|aircraftoverhauling and refurbishing the aircraft|and depreciation of Rs.12,75,507/- is an|allowable deduction as held in the earlier|assessment year despite the assessee|failing to show that this expenditure hasbeen incurred in the course of its|business as held by the Assessing|Officer. (i). Whether the Tribunal was correct in|holding that the claim of bad debts made|by|theasSSCSSCE1Sanallowablededuction as in the earlier assessment|year without examining the facts arisingfor the current assessment year andrecording the finding as to whether such|a claim is qllowable under section 36 or' 37 of the Act by satisfying the conditionsStipulated there in. 3.|Insofar as the first substantial question of law isconcerned, there does not appear to be any dispute thataSimilar|questionOT lawWaSframed1nNITA.No.338/2007 for the assessment year 1998-99. Thesaid income tax appeal, we are informed, has beendisposed of by this court vide judgment and order dated19-11-2013 and the matter has been remanded to theAssessing Authority for fresh disposal along with theconnected matters to avoid conflicting decisions. Weare further informed that so far, the Assessing Authorityhas not disposed of the matters in view of the orderdated 19[2%]November 2013 passed in ITA No.338/2007. |In the circumstances, we allow this appeal insofar asthe first substantial question of law is concerned. Theorder of the Tribunal, the First Appellate Authority andthe Assessing Officer are set aside and the matter isremanded to the Assessing Authority for fresh disposal along with other connected matters including the matterpertaining assessment year 1998-99. All contentions of the parties are kept open.| along with other connected matters including the matterpertaining assessment year 1998-99. All contentions of the parties are kept open.| 4Insofar as the second substantial question of lawis concerned, we are informed that this court in ITANo.492/2001 c/w ITA No.89/2003 has considered thevery same question and answered it in favour of therevenue and against the assessee. Learned counsel forthe assessee informed us that the assessee in those|cases has carried the matter to the Hon’ble SupremeCourt where the leave has been granted and the SLPhas been converted into Civil Appeal.No.8275/2013. 5In this view of the matter, we answer the secondsubstantial question of law in favour of the revenuesubject to the order that will be passed by the SupremeCourt in Civil Appeal No.8275/2013 (converted from.Special Leave to Appeal (Civil) No.13780/2010). The Assessing Officer is further directed not to take anyfurtherStepstill disposaloT|the.Civil AppealNo.8275/2013insofar as the second § substantia question of law is concerned. 6. The assessee is. directed to communicate thedecision of the Supreme Court in Civil AppealNo.8275/2013 to the Assessing Officer within a periodof 12 weeks from the date of its disposal. TS|With these observations, the appeal is disposed of. No costs. od/- JUDGE sd/-| JUDGE.