Ita/47/2010 Of The Commissioner Of Income Tax, Cochin v. M/S. Appollo Tyres Ltd., Kochi

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON & THE HONOURABLE MR.JUSTICE N.ANIL KUMAR WEDNESDAY, THE 13TH DAY OF MARCH 2019 / 22ND PHALGUNA, 1940 ITA.No. 47 of 2010 AGAINST THE ORDER IN ITA 43/COCH/2001 of I.T.A.TRIBUNAL,COCHINBENCH DATED 18-08-2009 APPELLANT/RESPONDENT: THE COMMISSIONER OF INCOME TAX, COCHIN. BY ADVS.JOSE JOSEPH, SC FOR INCOME TAXSRI.CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENTSRI.K.M.V.PANDALAI, INCOME TAX DEPARTMENT RESPONDENT/APPELLANT: M/S. APPOLLO TYRES LTD., KOCHICHERUPUSHPAM BUILDINGS,SHANMUGHAM ROAD,, KOCHI-31.BY ADVS.SRI.JOSEPH MARKOS (SR.)SMT.A.S.BEENUSRI.BINU MATHEWSRI.B.J.JOHN PRAKASHSRI.JOSEPH KODIANTHARA (SR.)SRI.MATHEWS K.UTHUPPACHANSRI.TERRY V.JAMESSRI.TOM THOMAS (KAKKUZHIYIL)SRI.V.ABRAHAM MARKOS THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 13.03.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT P.R. Ramachandra Menon, J. This appeal is at the instance of the Revenue.Challenge is against Annexure-C order passed bythe Income Tax Appellate Tribunal, Cochin Bench.The assessment is in respect of the assessmentyears 1996-97. 2. The respondent Assessee company is engaged in the manufacture and sale of automotive tyres,tubes, etc. Return was filed by the company on28.11.1996 which was followed by a revised return. Finally, the assessment was completed in terms ofSection 143(3) of the Income Tax Act by theAssessing Officer as per Annexure A order dated10.01.2002, fixing the tax liability accordingly. This was sought to be challenged by the Assesseeby filing appeal before the Commissioner of Income Tax. After considering the plus and minus points,the appeal was finalised as per Annexure-B order,whereby some points were answered in favour of theAssessee, while some additions were made in favour of the Revenue. This was challenged by both theAssessee and the Revenue before the Income TaxAppellate Tribunal. After hearing the matter indetail, along with some other cases, a commonverdict was passed as per Annexure-C order dated18.08.2009, whereby the grievance projected by the Assessee was redressed under some of the relevantheads, which are stated as detrimental to theinterest of the Revenue and hence the challenge inthe appeal filed by the Revenue. 3. Heard Mr.Joseph Markose, the learnedSr.Counsel for the Assessee as well as Mr. Christopher Abraham, the learned Standing Counselfor the Department, at length. 4. The Revenue has pointed out some questions, as involving substantial questions oflaw, which are in the following terms: 1.(a). Whether, on the facts and in thecircumstances of the case and also for thereasons stated in the grounds of appeal, isnot the loss of Rs.61,30,191/- on sale of IRFCbonds a capital loss and an impermissiblededuction under the I.T.Act? (b) Is not the decision reported in 255ITR inapplicable to the facts of the case forthe reasons stated in the grounds of appeal? 2.(a) Whether, on the facts and in thecircumstances of the case and also in view ofthe fact that the Welfare Trust created by theassessee in respect of transportation of theemployees, the assessee is entitled to claimdeductionofthecontributionofRs.22,66,580/- made to the trust? (b) Whether, on the facts and in thecircumstances of the case and in the light ofSec.40A(9) read with Sec.36(1)(iv)(v) readwith ground (F) the assessee is entitled todeduction under Sec. 37? 3. (a). Whether, on the facts and in thecircumstances of the case and also in view ofthe fact that the amount of Rs.90,00,000/- hadnot been advanced for carrying on the businessof the assessee, the assessee is entitled toclaim deduction of the same? (b) Whether, on the facts and in thecircumstances of the case, 1. did the assessee discharge the burden ofproof; 2. did the assessee establish the claim ofsaving of reputation; 3. the assessee is entitled to the deduction? (b) Whether, on the facts and in thecircumstances of the case and in the light ofSec.40A(9) read with Sec.36(1)(iv)(v) readwith ground (F) the assessee is entitled todeduction under Sec. 37? 3. (a). Whether, on the facts and in thecircumstances of the case and also in view ofthe fact that the amount of Rs.90,00,000/- hadnot been advanced for carrying on the businessof the assessee, the assessee is entitled toclaim deduction of the same? (b) Whether, on the facts and in thecircumstances of the case, 1. did the assessee discharge the burden ofproof; 2. did the assessee establish the claim ofsaving of reputation; 3. the assessee is entitled to the deduction? 7. This Court finds that the very samequestion in respect of the loss sustained by theAssessee, pursuant to sale of IRFC Bonds, showingit as a business loss and noted as a capital loss,was considered by us and answered in favour of theAssessee as per the judgment dated 13.3.2019 in ITANos.60/2010. 8. The issues raised in ITA 69/2010 and inthis case are almost similar and the figures givenare also exactly the same, which by itself showsthat the questions raised by the Revenue arelacking any merit, in so far as there is totalmistake of facts as well. 9. The question with regard to the advanceamount of Rs.90 lakhs, has been separately raisedin ITA No.204/2010 and the same has been consideredand answered against the Revenue as per separatejudgment passed by this Court today. As such,there is no further substantial question of law onthe aspect. okb 10. In the above circumstances, we hold thatno substantial question of law is involved hereinso as to invoke the power and jurisdiction of thisCourt as envisaged under Section 260A of theIncome Tax Act. The appeal fails and the same isdismissed accordingly. Sd/-JUDGE P.R.RAMACHANDRA MENON Sd/-N.ANIL KUMARJUDGE //True copy// P.S. to Judge