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TMI Blog2016 (1) TMI 127X X X X Extracts X X X X X X X X Extracts X X X X ..... issue primarily before going to the merits of that case as the contours of the area of discretion of the Courts in the matter of condonation of delays in filing appeals are set out in a number of Apex Court and specially in the case titled as Collector Land Acquisition, ... vs....... Mst. Katiji & Ors (1987 AIR 1353, 1987 SCR (2) 387) analyzed the situation while dealing with the delay on behalf of the Government and observed as enumerated below: "When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non deliberate delay." "It must be grasped that judiciary is respected not on account of its power to legalise injustice on technical grounds but because it is capable of removing injustice and is expected to do so." Considering the judgement (Supra) we feel that in litigations to which Government is a party there is yet another aspect which, perhaps, cannot be ignored, if appeals brought by Government are lost for such defaults, no person is individually affected but what, in the ultimate analysis, suffers i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4)(x) and 36(1)(va) of the Act held in para 3.2 of his order, which is reproduced below:- "3.2 I have carefully considered the submissions of appellant. The issue of allowability of contributions to Provident Fund is no longer res integra. The Hon'ble Supreme Court in the case of CIT vs. Alom Extrusions Ltd. (313 ITR 306) held the amendment to section 43B of the Income Tax Act carried out by the Finance Act 2003 is retrospective in operation. In the said decision the Hon'ble Supreme Court after considering provisions of sections 2 (24)(x) and 36(1)(va) of the IT Act held that Provident Fund contributions paid by an Employer prior to the "due date" of filing of the return is allowable deduction. In the present case the appellant in compliance to the manner prescribed on the relevant P.F Scheme paid Employer and Employee's contributions to Provident Fund on or before the due date for filing of the tax return for the AY 98- 99. In the light of the decision of the Supreme Court and the fact that the assessee discharged its liability to pay P.F contributions with due date u/s. 139(1). I hold that the appellant is entitled to the relief of Rs. 31,09,164/-. The AO is accordi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Further, Ld. AR submitted the duly audited balance-sheet, wherein the interest paid to the loan parties for an amount of Rs. 1,85,62,489/- was duly shown which is placed at page 28 of the paper book. We find that AO has disallowed the interest amount of Rs. 83,83,743/- on the misunderstanding of the facts given by assessee. In the books of accounts of the assessee there were admittedly interest expenses of Rs. 1,85,62,489.00. The chart filed by the Assessee before the AO showed only the unpaid interest of Rs. 1,01,78,746.00 as on 31.3.1998. Thus there was no discrepancy whatsoever as presumed by the AO. Accordingly we are inclined not to interfere in the order of CIT(A), therefore the ground of appeal of Revenue is dismissed. Third issue 13. The third issue raised by Revenue in this appeal is that Ld. CIT(A) has erred in deleting the addition of Rs. 24,00,316/- out of interest payment to UCO bank though the assessee debited the same in A.Ys 1993-94 & 1994-95. The facts in brief are that the assessee claimed a sum of Rs. 2,63,45,169/- as interest paid to UCO Bank. This interest was shown as prior year's adjustment in the books of account of assessee. This interest was exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch a lump sum amount of Rs. 5,72,68,000/- was paid by assessee. Accordingly, Ld. CIT(A) deleted the addition made by AO. Aggrieved by the relief allowed by CIT(A) the Revenue is in appeal before us. 14. As regards the claim of interest for an amount of Rs. 2,63,45,169/-paid to UCO bank as a result of OTS, the Ld AR demonstrated that assesseecompany did not charge any interest in the last five years and produced ledger account of UCO bank in the books of account of assessee for the AYs 1993- 94 to 1997-98 which are placed at pages 14 to 17 of assessee's paper book. It was submitted by the Ld AR that loan interest has been debited in its books of account and the liability for interest has been ascertained during the relevant previous year and same has been claimed in the relevant assessment year also. We find from the observation of AO that interest was debited in earlier years for the same loan for AY 1993-94 for a sum of Rs. 6,68,422/-. In this connection, it was found that interest was debited by assessee on account of some other loan of UCO bank only and this account was maintained by assessee at Guwahati branch of UCO bank and same amount was also settled by assessee with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A) deleted the addition made by AO by observing that profit of sale of asset was not chargeable as income. Aggrieved, Revenue is in appeal before us. 17. Before us Ld. DR supported the order of AO whereas Ld. AR supported the order of Ld. CIT(A). Ld. AR submitted that as per the accounting method, a company is to declare the profit arising on account of sale-purchase of its assets by crediting the profit and loss account. The AO added the profit arising from the sale of fixed assets treating it as normal business profit. However, while determining the profit chargeable the tax under Income Tax Act, the provision of Sec. 32 has to be complied with and accordingly the Ld. CIT(A) deleted the addition made by the AO. From the aforesaid submissions made by Ld. AR and examination of the case, the assessee has given the correct effect of profit arising from sale-purchase of its fixed assets in books of account and adjusting the written down value of its relevant block as per the income tax Act. We find no infirmity in the order of Ld. CIT(A) and we uphold the order of Ld. CIT(A) and this ground of Revenue's appeal is dismissed. Fifth issue:- 18. This ground of Revenue's appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the addition of Rs. 2 lacs on the ground that the assessee books were audited under the companies Act and income tax Act and there was no adverse remark from the auditor on the subject. Besides, the AO did not point out any specific instance where cultivation expenses were not supported by any evidence. Therefore the Ld. CIT(A) has deleted the addition made by the AO. Now, aggrieved revenue is in appeal before us. 23. We have heard rival parties and perused the materials available on record. The AO has just disallowed the expenses of Rs. 2 lacs on estimated basis which is not justifiable as per the law. The AO failed to provide the specific reason for the disallowance. Therefore we are inclined not to interfere in the order of Ld. CIT(A). So this ground of Revenue appeal is dismissed. Last issue: 24. This ground of Revenue's appeal is that Ld. CIT(A) has erred in treating the interest income of Rs. 21,575/- as business income though the AO treated the same as income from other source and applied Rule-8 of IT Rules, 1962. 25. During the year, assessee has earned interest of Rs. 21,575/- from SMIFS capital markets Ltd. The AO treated the same as income from other source in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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