ADDL. CIT, SPECIAL RANGE- 7, NEW DELHI v. POWER LINKS TRANSMISSION LTD., NEW DELHI

ITA 5966/DEL/2017 | 2014-2015
Pronouncement Date: 02-03-2021 | Result: Dismissed

Appeal Details

RSA Number 596620114 RSA 2017
Assessee PAN AABCT7775M
Bench Delhi
Appeal Number ITA 5966/DEL/2017
Duration Of Justice 3 year(s) 5 month(s) 12 day(s)
Appellant ADDL. CIT, SPECIAL RANGE- 7, NEW DELHI
Respondent POWER LINKS TRANSMISSION LTD., NEW DELHI
Appeal Type Income Tax Appeal
Pronouncement Date 02-03-2021
Appeal Filed By Department
Order Result Dismissed
Bench Allotted F
Tribunal Order Date 02-03-2021
Last Hearing Date 03-11-2020
First Hearing Date 03-11-2020
Assessment Year 2014-2015
Appeal Filed On 19-09-2017
Judgment Text
ITA NO.-5965 5966/DEL/2017 M/S. POWER LINKS TRANSMISSION LTD. PAGE 1 OF 6 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: F: NEW DELHI) BEFORE SHRI SUDHANSHU SRIVASTAVA JUDICIAL M EMBER AND SHRI ANADEE NATH MISSHRA ACCOUNTANT MEM BER ITA NO:- 5965/DEL/2017 ( ASSESSMENT YEAR: 2013-14) ITA NO. : 5966/DEL/2017 (ASSESSMENT YEAR : 2014-15) ADDL. CIT SPECIAL RANGE-7 NEW DELHI VS. M/S. POWER LINKS TRANSMISSION LTD. 10 TH FLOOR DLF TOWER-A DISTRICT CENTRE JASOLA NEW DELHI-110025 PAN NO: AABCT7775M APPELLANT RESPONDENT REVENUE BY : SH. SUSHMA SINGH CIT- DR ASSESSEE BY : SH. MANONEET DALAL ADV. SMT. YISHU GOEL ADV. PER ANADEE NATH MISSHRA AM (A) THESE TWO APPEALS BY ASSESSEE ARE FILED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 38 [LD. CIT( A) FOR SHORT] DATED 15.06.2017 FOR ASSESSMENT YEAR 2013-14 AND A.Y. 20 14-15 RESPECTIVELY. GROUNDS TAKEN IN THIS APPEAL OF ASSESSEE ARE AS UND ER: ITA NO.-5965 5966/DEL/2017 M/S. POWER LINKS TRANSMISSION LTD. PAGE 2 OF 6 ITA NO:- 5965/DEL/2017 A.Y. 2013-14 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LD. CIT(A) ERRED IN LAW DELETING THE DISALLOWANCE U/S 36(1)(II I) ON ACCOUNT OF INTEREST EXPENSE ON BORROWINGS AMOUNTING TO RS. 5 6 4 73 054/-. 2. THE APPELLANT CRAVES TO BE ALLOWED TO ADD ANY FR ESH GROUND(S) OF APPEAL AND/ OR DELETE OR AMEND ANY OF THE GROUND(S) OF APPEAL. ITA NO:- 5966/DEL/2017 A.Y. 2014-15 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LD. CIT(A) ERRED IN LAW DELETING THE DISALLOWANCE U/S 3 6(1)(III) ON ACCOUNT OF INTEREST EXPENSE ON BORROWINGS AMOUNTING TO RS. 8 63 54 989/-. 2. THE APPELLANT CRAVES TO BE ALLOWED TO ADD ANY FR ESH GROUND(S) OF APPEAL AND/OR DELETE OR AMEND ANY OF THE GROUND(S) OF APPEAL. (B) THE ONLY ISSUE IN DISPUTE IN THESE TWO APPEALS IS R EGARDING THE DISALLOWANCES MADE BY THE ASSESSING OFFICER [AO FOR SHORT] IN T HE CORRESPONDING ASSESSMENT YEARS U/S 36(1)(III) OF INCOME TAX ACT 1961 [IT ACT FOR SHORT] OUT OF ASSESSEES CLAIM FOR INTEREST EXPENSES. AT THE TIME OF HEARING BEFORE US IN INCOME TAX APPELLATE TRIBUNAL [ITAT FOR SHORT] . REPRESENTATIVES OF B OTH SIDES WERE IN AGREEMENT THAT THE ISSUE IN DISPUTE IN BOTH THESE APPEALS BEFORE U S ARE COVERED BY ORDERS OF CO- ORDINATE BENCHES OF INCOME TAX APPELLATE TRIBUNAL DELHI DATED 08.02.2019 IN ITA NO. 1809/DEL/2016 FOR A.Y. 2012-13; AND DATED 21.12 .2018 IN ITA NO. 3869 & 3870/DEL/2014 FOR A.Y. 2007-08 AND 2010-11 RESPECTI VELY. THE AFORESAID ORDERS DATED 08.02.2019 AND 21.12.2018; COPIES WHEREOF WER E FILED DURING APPELLATE PROCEEDINGS IN ITAT IN THE PRESENT APPEALS BEFORE U S; WERE PASSED IN ASSESSEES OWN CASE; AND THE IDENTICAL ISSUES WERE DECIDED AGAINST REVENUE AND IN FAVOUR OF ASSESSEE. BOTH SIDES WERE IN AGREEMENT BEFORE US A T THE TIME OF HEARING THAT THE ITA NO.-5965 5966/DEL/2017 M/S. POWER LINKS TRANSMISSION LTD. PAGE 3 OF 6 FACTS AND CIRCUMSTANCES IN THE PRESENT APPEALS BEFO RE US FOR A.Y. 2013-14 AND 2014- 15 ARE SAME AS FACTS AND CIRCUMSTANCES FOR A.Y. 200 7-08 2010-11 AND 2012-13 TO WHICH AFORESAID ORDERS DATED 21.12.2018 AND 08.02.2 019 PERTAIN. IT WAS ALSO BROUGHT TO OUR NOTICE THAT THE AFORESAID ORDERS DAT ED 21.12.2018 AND 08.02.2019 PASSED BY CO-ORDINATE BENCHES OF ITAT DELHI ON IDEN TICAL ISSUES IN ASSESSEES OWN CASE HAVE BEEN ACCEPTED BY REVENUE AND NO APPEAL HAS BEEN FILED U/S 260A OF IT ACT BY REVENUE. IT WAS ALSO BROUGHT TO OUR NOTICE AT THE TIME OF HEARING BY LD. COUNSEL FOR ASSESSEE; THAT THE IMPUGNED ORDERS OF L D. CIT(A) DELETING THE DISALLOWANCES OF INTEREST EXPENSES; WERE BASED ON E ARLIER ORDERS OF LD. CIT(A) ON IDENTICAL ISSUES FOR A.Y. 2010-11 AND A.Y. 2012-13 IN WHICH ALSO DISALLOWANCES OF INTEREST EXPENSES WERE DELETED BY LD. CIT(A); AND F URTHER THAT ORDER OF LD. CIT(A) FOR A.Y. 2010-11 AND A.Y. 2012-13 ARE ALREADY CONFI RMED IN AFORESAID ORDERS DATED 21.12.2018 AND 08.02.2019 OF CO-ORDINATE BENCHES OF ITAT DELHI PASSED IN ASSESSEES OWN CASE. FOR EASE OF REFERENCE THE REL EVANT PORTION OF AFORESAID ORDER DATED 21.12.2018 OF CO-ORDINATE BENCH OF ITAT PASS ED IN ASSESSEES OWN CASE; WHICH WAS ALSO FOLLOWED IN AFORESAID ORDER DATED 08 .02.2019 OF CO-ORDINATE BENCH OF ITAT DELHI IN ASSESSEES OWN CASE; IS REPRODUCED B ELOW : (4) WE HAVE HEARD BOTH SIDES PATIENTLY AND WE HAVE PERUSED THE MATERIALS ON RECORD INCLUDING THE PAPER BOOK SYNO PSIS ETC. FILED IN THE COURSE OF APPELLATE PROCEEDINGS IN ITAT CAREFULLY. WE HAVE ALSO CONSIDERED THE JUDICIAL PRECEDENTS REFERRED TO IN T HE RECORD AND ALSO THE PRECEDENTS BROUGHT TO OUR ATTENTION AT THE TIME OF HEARING BEFORE US. (4.1) THE COMMON ISSUE INVOLVED IN BOTH THE APPEALS FILED BY REVENUE IS REGARDING DISALLOWANCE OF INTEREST U/S 36(1)(III) O F I.T. ACT. AS MENTIONED EARLIER THE LD. DR DID NOT DISPUTE THE FACTS CONTE NDED BY THE LD. COUNSEL FOR ASSESSEE. THE RELEVANT FACTS ARE NOT IN DISPUTE . IT IS NOT IN DISPUTE THAT THE INVESTMENTS IN MUTUAL FUNDS HAD NOT STARTED TIL L THE TIME THE ASSESSEE ITA NO.-5965 5966/DEL/2017 M/S. POWER LINKS TRANSMISSION LTD. PAGE 4 OF 6 STARTED EARNING OPERATING INCOME FROM TRANSMISSION OF ELECTRICITY. IT IS ALSO NOT IN DISPUTE THAT THE BORROWED FUNDS WERE ENTIREL Y USED BY THE ASSESSEE FOR INVESTMENT IN FIXED ASSETS FOR THE PURPOSES OF BUSINESS. IT IS FURTHER NOT IN DISPUTE THAT THE ASSESSEE HAD ADEQUATE INTER EST FREE FUNDS OF ITS OWN FOR MAKING INVESTMENTS IN MUTUAL FUNDS. IT IS FURTHERMORE NOT IN DISPUTE THAT THERE WERE CONTRACTUAL RESTRICTIONS IM POSED ON ASSESSEE IN RESPECT OF UTILIZATION OF BORROWED FUNDS; AND ALSO THE ASSESSEE WAS LIABLE FOR PAYMENT OF SUBSTANTIAL AMOUNTS OF LIQUIDATION D AMAGES/PRE-PAYMENT CHARGES IN CASE THE ASSESSEE MADE PRE-PAYMENT OF LO AN REPAYMENTS. THUS IT IS ALSO NOT IN DISPUTE THAT DUE TO CONTRAC TUAL RESTRICTIONS AND LIQUIDATION DAMAGES/PRE-PAYMENT CHARGES AS AFORESA ID; IT WAS NEITHER PRUDENT FOR THE ASSESSEE TO DIVERT ANY PART OF BORR OWED FUNDS FOR NON- BUSINESS PURPOSES; NOR WAS IT PRUDENT TO MAKE PRE-P AYMENT OF LOAN REPAYMENTS EVEN IF THE ASSESSEE HAD ITS OWN INTERES T FREE FUNDS. IN THESE SPECIFIC AND PECULIAR FACTS AND CIRCUMSTANCES THER E IS NO CASE FOR ANY DISALLOWANCE OF INTEREST U/S 36(1)(III) OF I.T. ACT . MOREOVER LD. DR FAILED TO BRING ANY MATERIAL FACTS TO OUR NOTICE TO DISTIN GUISH THE FACTS OF THE ASSESSEE WITH THE FACTS OF THE JUDICIAL PRECEDENTS ON WHICH THE LD. CIT(A) RELIED UPON AND ON WHICH THE LD. COUNSEL FOR ASSESS EE RELIED UPON DURING APPELLATE PROCEEDINGS IN ITAT. THE LD. DR THUS FAIL ED TO MAKE ANY CASE FOR ANY INTERFERENCE BY US WITH THE ORDER OF LD. CI T(A) ON THIS ISSUE. (4.2) IN VIEW OF THE AFORESAID SPECIFIC AND PECULIA R FACTS AND CIRCUMSTANCES OF THE CASE AND IN VIEW OF THE FOREG OING DISCUSSION WE DECLINE TO INTERFERE WITH THE DECISION OF LD. CIT(A ) ON THE ISSUE OF DISALLOWANCE OF INTEREST U/S 36(1)(III) OF I.T. ACT ON MERITS. ACCORDINGLY BOTH THE APPEALS FILED BY THE REVENUE ARE DISMISSED . (C) NEITHER SIDE HAS BROUGHT ANY FACTS AND CIRCU MSTANCES TO OUR ATTENTION IN A.Y. 2013-14 AND 2014-15 (TO WHICH THE PRESENT APPE ALS BEFORE US PERTAIN) TO DISTINGUISH FROM FACTS AND CIRCUMSTANCES OF A.Y. 20 07-08 2010-11 AND 2012-13 (TO WHICH AFORESAID ORDERS DATED 21.12.2018 AND 08.02.2 019 OF CO-ORDINATE BENCHES OF ITAT DELHI PERTAIN); OR TO PERSUADE US TO TAKE A V IEW DIFFERENT FROM THE VIEW TAKEN BY LD. CIT(A) IN THE IMPUGNED ORDERS OF LD. CIT(A) IN THE PRESENT APPEALS BEFORE US. IN VIEW OF THE FOREGOING; AND RESPECTFULLY FOLLOWIN G THE AFORESAID ORDERS DATED 21.12.2018 AND 08.02.2019 OF CO-ORDINATE BENCHES OF ITAT DELHI PASSED IN ASSESSEES OWN CASE ON IDENTICAL ISSUES IN IDENTICA L FACTS AND CIRCUMSTANCES [WHICH ITA NO.-5965 5966/DEL/2017 M/S. POWER LINKS TRANSMISSION LTD. PAGE 5 OF 6 HAVE ALSO BEEN ACCEPTED BY REVENUE (AS AFORESAID)] ; WE DECLINE TO INTERFERE WITH THE IMPUGNED APPELLATE ORDERS OF LD. CIT(A) IN BOT H THE APPEALS BEFORE US. ACCORDINGLY IN THE FACTS AND CIRCUMSTANCES OF THE TWO APPEALS BEFORE US; THE ISSUES IN DISPUTE IN BOTH THE APPEALS BEFORE US ARE DECIDE D IN FAVOUR OF ASSESSEE AND AGAINST REVENUE. BOTH THESE APPEALS BEFORE US ARE D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 02/03/2021 . SD/- SD/- (SUDHANSHU SRIVASTAVA) (ANAD EE NATH MISSHRA) JUDICIAL MEMBER ACCOUN TANT MEMBER DATED: 02/03/2021 *BINITA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI