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Commissioner of Income Tax-10 Versus M/s ICICI Home Finance Co. Ltd.

2015 (12) TMI 567 - BOMBAY HIGH COURT

Entitlement for deduction u/s 36(1) (viii) - Tribunal was correct in its opinion that the Respondent company was in the business of providing long term finance for development of housing in India, thereby making it entitled for deduction u/s 36(1) (viii), when it had in fact stopped the business of providing housing loans from the financial year 2001-02 - Held that:- We find that the impugned order of the Tribunal renders a finding of fact that the Respondent-Assessee during the subject Assessme .....

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entitled to the Section 36(1)(viii) of the Act.

The finding rendered by the Tribunal in the impugned order is a finding of fact and the Revenue has not been able to show that the finding of fact is in any manner perverse or arbitrary. - Decided against revenue. - Income Tax Appeal No. 2002 of 2013 - Dated:- 24-11-2015 - M. S. Sanklecha And G. S. Kulkarni, JJ. For the Petitioner : Mr. Arvind Pinto For the Respondent : Ms. A. Vissinji a/w Mr. S.J. Mehta ORDER P. C. 1. This appeal under .....

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erm finance for development of housing in India, thereby making it entitled for deduction u/s 36(1) (viii), when it had in fact stopped the business of providing housing loans from the financial year 2001-02." 3. The Respondent-Assessee, is a Housing Finance Company, which filed its returns of income for the Assessment Year 200506 declaring its income at ₹ 28.55 Crores. The Assessing Officer by his order dated 26th December, 2007 passed under Section 143(3) of the Act, determined the .....

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ed should not be revised as it proceeds on the basis that Respondent-Assessee is in the business of proving long term finance for construction of residential houses. In response, the Respondent Assessee submitted as under : "During the course of assessment, it was submitted that 1HFC has discontinued the business of giving fresh housing loans and the same are disbursed by ICICI Bank. However, we would like to draw your Honour's attention to the fact that 1HFC is still in the business of .....

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n 36(1)(viii) @ 40% of its income derived from the business of long term finance from housing computed under the head "Profit and gains from business or profession" before making any deduction under the said clause. The said business income included fee income of ₹ 30.92 crores and interest received from other sources of ₹ 4.64 crores and other miscellaneous income of ₹ 70.71 lakhs. Fee income comprises of processing fees in respect of loans disbursed during the year, .....

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of Income Tax did not accept the submissions of the Respondent Assessee justifying its claim under Section 36(i)(vii) of the Act. The Commissioner of Income Tax in his order dated 15th March, 2010 held that the Respondent Assessee has discontinued giving fresh housing loans and was merely servicing old loans. Therefore, the Commissioner of Income Tax held that the Respondent Assessee was not in the business of providing housing loans in the subject assessment year, so as to be eligible for dedu .....

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e BalanceSheet indicates the following details of the loans and other credit facilities given by it : As at 31st March, 2004 As at 31st March, 2005 Housing loans to Individuals Rs.2280.36 crores ₹ 2355.75 crores Housing loans to Corporate Rs.190.90 crores Rs.27.27 crores Other loans ₹ 11.76 crores ₹ 35.03 crores From the aforesaid facts, the impugned order records that there has been an increase in housing loans during the subject Assessment Year. Besides, on perusal of the cop .....

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