TMI Blog2014 (5) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... ned – Relying upon Britannia Industries Ltd. v/s CIT [2005 (10) TMI 30 - SUPREME Court] - factual matters have to be verified and examined in the light of the legal principles that the matter has been remitted back to the AO – as such the direction does not raise any substantial question of law – Decided against Revenue. Fully convertible FCCBs into equity shares – Held that:- The CIT(A) had confirmed the disallowance on the footing that the bonds were fully convertible into shares, the issue of bonds was made after creating an authorized capital and which could take into account stock of shares, therefore, a debatable question is raised – the appeal admitted on this question – Decided in favour of Revenue. Development expenses – App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For the Respondent : Mr. Sanjiv M. Shah ORDER P. C. 1. We have heard Mr.Vimal Gupta, learned senior advocate appearing on behalf of the revenue in support of this appeal and Mr.Shah, learned advocate appearing for the respondent assessee. We have perused the detailed order passed by the Income Tax Appellate Tribunal, dated 29th October, 2009 from which this appeal arises. The assessment year is 1997-1998. The questions of law and which, according to Mr.Gupta, are substantial, have been formulated at paragraph 4, page 4 of the paper book. 2. The submission of the learned senior counsel is that, each of this would be a substantial question of law, inasmuch as, the Tribunal has misdirected itself in granting the relief and not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also with regard to the guest house expenses, the Tribunal has once again assigned cogent and satisfactory reasons. The expenditure incurred on maintenance of guest house is a issue which has been examined. However, we find that the Tribunal has noted the rival contentions. It has also referred to its earlier orders. It has also referred to the judgment of the Hon'ble Supreme Court in the case of Britannia Industries Ltd. v/s CIT, reported in (2005) 278 ITR 546 (SC). Since factual matters have to be verified and examined in the light of the legal principles that the matter has been remitted back to the Assessing Officer, we are of the view that such a direction does not raise any substantial question of law. It would be open for the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr.Shah that just because there is no judgment of this Court, by itself, is not a substantial question of law, more so, when the view taken by the Rajsthan High Court has been accepted by the Karnataka, Calcutta and the Madras High Court. In such circumstances and when there is nothing contrary, then the settled principle that debenture is a loan, would have to be applied. 8. We are of the opinion that, in the light of the rival contentions and particularly the fact that the Commissioner of Income Tax (Appeals) had confirmed the disallowance on the footing that the bonds were fully convertible into shares, the issue of bonds was made after creating an authorized capital and which could take into account stock of shares, therefore, a deba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two judgments, namely, the Commissioner of Income Tax v/s Swaraj Engines Ltd. (supra) and the judgment of the Division Bench of this Court in the case of Commissioner of Income Tax, Mumbai v/s TATA Engineering Locomotive Co. Pvt. Ltd., reported in (1980) 123 ITR 538. The appeal, therefore, deserves admission on this question as well. 11. As far as the questions raised with regards to the deletion of disallowance of Rs.1.40 crores, namely, payment made to M.S.E.B. for additional power is concerned, having perused the order passed by the Tribunal in that regard, we are of the opinion that the Tribunal has considered the matter essentially in the light of the factual position brought on record. It has, therefore, interfered with the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Appellate Tribunal, in their orders have examined this issue at length. In fact, the Tribunal's earlier order in the case of the very assessee has been followed by both. To our mind, the analysis and particularly at paragraph 15.2 of the Commissioner of Income Tax (Appeals)'s order, would reveal that the expenses already incurred are reduced and the balance was accounted as provision. This is found to be an admissible deduction. In such circumstances, even this aspect does not raise any substantial question of law. The appeal is dismissed to that extent. 13. To our mind, even the provision for pending labour demands and its disallowance made by the Assessing Officer is rightly deleted. The Tribunal has found that the demands ..... X X X X Extracts X X X X X X X X Extracts X X X X
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