2009 (8) TMI 1288 - AT - Income Tax

Summary

Issues involved: Cross appeals arising out of CIT(A)'s order for A.Y. 2003-04.

Assessee's appeal (ITA no. 1603/Del/09):

Issue 1 - Ground no. 1:
The claim of the assessee for interest on excess sugar price for 1978-79 and 1979-80.
- Assessee claimed interest accrued on deposits of excess sugar price not to be treated as income.
- AO disallowed the claim citing previous disallowance.
- CIT(A) directed AO to decide in accordance with ITAT's direction for A.Y. 1999-2000.
- Tribunal found issue in favor of assessee based on earlier orders, allowed the claim.

Issue 2 - Ground no. 2:
Assessee's claim for interest liability on excess sugar price realization.
- Assessee claimed exclusion of interest accrued from taxable income.
- AO disallowed claim citing previous disallowance.
- CIT(A) directed AO to decide in accordance with ITAT's direction for A.Y. 1999-2000.
- Tribunal found issue in favor of assessee based on earlier orders, allowed the claim.

Issue 3 - Ground no. 3:
Disallowed claim of bad debt written off.
- Assessee did not press this ground, so it was dismissed.

Issue 4 - Ground no. 4:
Treatment of interest income as income from other sources instead of business income.
- Assessee's detailed arguments were not considered by CIT(A).
- Tribunal deemed the ground premature, directed assessee to approach CIT(A) first.

Revenue appeal (ITA no. 1785/Del/2009):

Issue 1 - Ground no. 1:
Disallowed interest on late payment of PF.
- AO made disallowance based on previous assessment.
- CIT(A) deleted the disallowance.
- Tribunal upheld CIT(A)'s decision based on previous orders.

Issue 2 - Ground no. 2:
Disallowed interest on interest-free loans to bodies corporate.
- AO made disallowance based on previous assessment.
- CIT(A) deleted the disallowance.
- Tribunal upheld CIT(A)'s decision based on previous orders.

In conclusion, assessee's appeal was partly allowed, and revenue's appeal was dismissed.