Ita/67/2009 Of The Commissioner Of Income Tax v. M/S. South West Mining Ltd

IN THB HIGH COURT OF KARNATAKA AT BANGALOREDATEBD THIS THE 1 DAY OF NOVEMBER, 2014 “PRESENT: THE HON’BLE MR. JUSTICE N.KUMAR| AND THE HON’BLE MR. JUSTICE B.MANOHAR| BETWEEN ITA NO.67/2009 1.THR COMMISSIONBR OF | INCOME TAX, C.R.BUILDING,| QUEENS ROAD, BANGALORE. 2.THR DBPUTY COMMISSIONBR. OF INCOME-TAX, ..APPELLANTS CIRCLE-1, BELLARY. (BY SRI.K.V.ARAVIND, ADV.., AND M/S. SOUTH WEST MININGLIMITED, VIDYANAGAR, |TORANAGALLU, BELLARY. .RESPONDENT (BY SRI S.PARTHASARATRHY,SRI V.K.GURUNATHAN, AND MS.JINITHA CHATTERJI, ADVS) THIS [TA IS FILED UNDER SECTION 2J60-A OF THEINCOME TAX ACT, 1961 ARISING OUT OF ORDER DATED|19.09.2008 PASSED IN ITA NO.1008/BNG/2007, FOR THE|ASSESSMENT YEAR 2003-04, PRAYING TO (I) FORMULATETHE.SUBSTANTIALQUESTIONS.OF|LAWSTATED.THEREIN. (IJ) ALLOW THE APPEAL AND SET ASIDE THE|ORDER PASSBKHD BY THR ITAT BANGALORE IN ITNO.1008/BNG/2007,DATEHD19.09.2008|CONFIRMINGTHR ORDBR OF THR APPBLLATK COMMISSIONBR AND| Q CONFIRMTHE.ORDERPASSEDBY|THE.DEBPUTYCOMMISSIONER OF INCOME TAX, CIRCLE-1, BELLARY, INTHE INTEREST OF JUSTICE AND EQUITY. THIS ITA COMING ON FOR FINAL HBARING THIS.DAY,N. KUMAR J, DELIVERED THE FOLLOWING: JU DBGMEN Ti Revenue has preferred this appeal assailing theorder passed by the Tribunal in upholding the orderpassed by the First Appellate Authority, where theAuthority on the basis of the remand report hasapportionedtheCXPCIISCGincurred|towardsthepreliminary expenses and the revenue expenses. 2 |The assessee had obtained lease otf land for|mining activities on 31.10.2001. The license for miningwas obtained on 24.01.2002. The agreement with M/s.Sun Investments Ltd. was executed on 08.03.2002. Thedate|ot|CommencementyoT|production WaS OT]29.09.2002. The first sale relating to the miningactivities was affected on 15.07.2007. The Tribunal hasheld that the substantial work was executed and-performed by assessee itself, even before the appearanceof the consultant i.e., M/s. Sun Investments Ltd. 3 Further, it held that though the agreement containsmulti various commitments on the part of theconsultant, it cannot be presumed that all thecommitments were met by the consultant. There isevery possibility for the assessee to even perform someactivities which the consultant ought to have performedin its anxiety to complete the project. The payment tothe consultant is not in dispute. Even some payments.ought to have been rendered even outside the scope ofcontractdueTOcommercialprudence.TheCommissioner of Income-tax (Appeals) has made an.extensive exercise and has come to a reasonable|conclusion and apportioned the expenses. The saidpayment was done on the basis of the remand reportissued by the Assessing Authority. Therefore, theTribunal as well as the First Appellate Authority foundno ground to interfere with the said apportionment. 3.|When two fact finding authorities on thebasis of the evidence on record coupled with the remandreport, apportioned the expenses, we do not see anyjustiiable ground to interfere with the said finding of 4 fact arrived at by the Authorities. We do not find anymerits in this appeal and we also decline to answer thesubstantial questions of law which were framed, whichin our view does not arise for consideration in this|appeal. Accordingly, appeal is dismissed. Sd/-.JUDGE Sd/-. JUDGE| KSR