2013 (11) TMI 1050 - HC - Income Tax

Allowability of lease rent - Held that - When the tribunal has remanded the matter to the Assessing Officer for a fresh decision, we fail to appreciate why the tribunal should restrict the decision by the Assessing Officer considering the decision of the Special Bench of the tribunal rendered in the case of IndusInd Bank Ltd 2012 (3) TMI 212 - ITAT MUMBAI only. - The issue was restored for fresh decision.

Summary

Issues:
1. Interpretation of tribunal's direction regarding the allowability of lease rent.
2. Scope of remand to the Assessing Officer in light of tribunal's decision.

Analysis:
1. The main issue in this case revolved around the interpretation of the tribunal's direction regarding the allowability of lease rent. The tribunal had remanded the matter to the Assessing Officer to decide on the disallowance of Rs.1,89,17,094/- towards lease rent paid. The appellant contended that the Assessing Officer should not be restricted to considering only the decision of the Special Bench of the tribunal in the case of IndusInd Bank Ltd. The appellant argued that the Assessing Officer should make a fresh decision based on the prevailing law and case law at the time of deciding the matter. The court agreed with the appellant's contention and clarified that the remand should not be limited to the decision of the Special Bench but should include consideration of all relevant legal aspects and case law.

2. The second issue dealt with the scope of the remand to the Assessing Officer. The court found that the tribunal's direction was too restrictive as it only focused on the decision of the Special Bench in the case of IndusInd Bank Ltd. The court emphasized that the Assessing Officer should make a fresh decision in accordance with the law and case law applicable at the time of deciding the matter. The court clarified that the remand was not limited to the decision of the Special Bench but extended to a comprehensive reconsideration of the issue based on legal provisions and merits. Consequently, the court disposed of the Tax Appeal, affirming the need for a broader assessment by the Assessing Officer in line with legal principles and precedents.

In conclusion, the judgment underscored the importance of a comprehensive reconsideration by the Assessing Officer, emphasizing the need to consider all relevant legal aspects and case law while deciding on the allowability of lease rent. The court's decision aimed to ensure a fair and thorough assessment based on the law prevailing at the time of the decision, rather than being restricted to a specific tribunal decision.