Similarly, Learned Senior Counsel For The Assessee Submitted That Substantial Question Of Law v. Cit’, 228 Itr 674 (Kar), ‘Commissioner Of Income Tax V. Rathi Graphics Technologies Ltd’, 378 Itr 107 (Delhi) And Answered Against The Revenue. Learned Counsel

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9 DAY OF JUNE 2020 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR. JUSTICE HEMANT CHANDANGOUDAR BETWEEN I.T.A. NO.139 OF 2011 1.THE COMMISSIONER OF INCOME TAX C R BUILDING, QUEENS ROAD, BANGALORE C R BUILDING, QUEENS ROAD, BANGALORE 2.THE ASST. COMMISSIONER OF INCOME TAX CIRCLE - 11(3) C R BUILDING, QUEENS ROAD, BANGALORE. ... APPELLANTS (BY SRI K V ARAVIND, ADV.) AND M/S JSW STEEL LIMITED (FORMERLY KNOWN AS JINDAL VIJAYANAGAR STEEL LIMITED ) JINDAL MANSION, 5A, DR G DESHMUKH MARG, MUMBAI 400 026. ... RESPONDENT (BY SRI A.SHANKAR, SENIOR ADVOCATE FOR SRI M LAVA, ADV.) - - - THIS ITA IS FILED UNDER SECTION.260-A OF I.T.ACT, 1961 ARISING OUT OF ORDER DATED 10-12-2010 PASSED IN ITA NO.929/BANG/2009, FOR THE ASSESSMENT YEAR 2003-2004, PRAYING TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN, II. ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE ITAT, BANGALORE IN ITA NO.929/BANG/2009 DATED 10-12-2010 AND CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-11(3), BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. THIS ITA COMING ON FOR FINAL HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING: JUDGMENT This appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’, for short) has been filed by the revenue. The subject matter of the appeal pertains to Assessment year 2003-04. The appeal was admitted by a Bench of this Court vide order dated 24.11.2011 on the following substantial questions of law: a) Whether the finding of the appellate authorities that a sum of Rs.211,57,21,643/- conversion of interest payable to financial institutions, banks into 10% redeemable preference shares would amount to allowable revenue expenditure when the same is not actually paid, is perverse and arbitrary as payments have not been made and contrary to explanation 3C to Section 43B of the Act? b) Whether the finding of the appellate authorities that a sum of Rs.1,89,40,966/- while allowable as expenditure when the said interest had been written off, is perverse and arbitrary? 2. Facts giving rise to filing of this appeal briefly stated are that assessee is carrying on the business of manufacture and sale of pellets hot rolled coils, sheets and plates. The assessee filed the return of income declaring the loss in respect of the Assessment year 2003-04. The assessee claimed a sum of Rs.211.57 Crores restructuring package as deduction and further claimed a sum of Rs.1,89,40,966/- as interest written off. The assessing officer by an order dated 24.03.2006, disallowed the claim for restructuring package as deduction and it was further held that if interest component was written off then the question of allowing the deduction of the principal as an expenditure did not arise. The Commissioner of Income Tax (Appeals) partly allowed the appeal. Being aggrieved, the revenue preferred an appeal. The tribunal by order dated 10.12.2010 dismissed the appeal preferred by the revenue. 3. We have heard the learned counsel for the parties. Learned senior counsel for the assessee submitted that substantial question of law No.2 framed in this appeal is squarely covered by a decision rendered by division bench of this Court in ITA No.150/2003 dated 17.08.2011 which is answered against the revenue. The aforesaid statement could not be disputed by learned counsel for the revenue. 4. Similarly, learned senior counsel for the assessee submitted that substantial question of law No.1 is covered by decisions of this court as well as Delhi High Court in case of ‘KIRLOSKAR ELECTRIC CO. LTD VS. CIT’, 228 ITR 674 (KAR), ‘COMMISSIONER OF INCOME TAX V. RATHI GRAPHICS TECHNOLOGIES LTD’, 378 ITR 107 (DELHI) and answered against the revenue. Learned counsel for the revenue was unable to dispute the aforesaid submissions as well. framed in this appeal is squarely covered by a decision rendered by division bench of this Court in ITA No.150/2003 dated 17.08.2011 which is answered against the revenue. The aforesaid statement could not be disputed by learned counsel for the revenue. 4. Similarly, learned senior counsel for the assessee submitted that substantial question of law No.1 is covered by decisions of this court as well as Delhi High Court in case of ‘KIRLOSKAR ELECTRIC CO. LTD VS. CIT’, 228 ITR 674 (KAR), ‘COMMISSIONER OF INCOME TAX V. RATHI GRAPHICS TECHNOLOGIES LTD’, 378 ITR 107 (DELHI) and answered against the revenue. Learned counsel for the revenue was unable to dispute the aforesaid submissions as well. 5. For the reasons assigned in the aforesaid judgments, the substantial questions of law framed by a bench of this court are answered against the revenue. In the result, the appeal is dismissed. Sd/- JUDGE Sd/- JUDGE ss