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TMI Blog2011 (12) TMI 134X X X X Extracts X X X X X X X X Extracts X X X X ..... st the order of the Income Tax Appellate Tribunal (for short, the tribunal) in the case of M/s Narang Industries Private Ltd. The appeal pertains to the assessment year 2003-04. 2. Several issues have been decided by the tribunal in the impugned order dated 8th April, 2011. The Revenue has preferred the present appeal only in respect of one ground i.e., the addition of Rs.1,59,28,955/- made by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany while saddling itself with huge financial burden. Before proceeding further on the issue it is necessary to examine whether assessee's partaking its distillery business was out of any business prudence or aimed at reducing its tax burden. There is no denying the fact that M/s Narang Distillery Ltd. is a wholly owned subsidiary of the assessee company & in spite the distillery business of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The facts noticed by the CIT (Appeals) and the tribunal, are that the respondent had borrowed money for a term loan and working capital requirements. During the last assessment year, the respondent had paid an amount of Rs.1,53,99,329/- towards interest and finance charges. 6. The assessee had transferred the brewery business in the assessment year 2001-02 to it's subsidiary Narang Brewery Ltd. f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery business. The distillery business was hived off to Narang Distillery Ltd. on 5th December, 2002 against which 19,50,000/- equity shares of Narang Distillery Ltd. of Rs.10/- each amounting to Rs.5,58,67,500/- were allotted. Narang Distillery Ltd. was subsidiary to the respondent. The respondent had made investment of Rs.5,63,67,500/- in Narang Distillery Ltd. It is also recorded by the appellat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds interest payment this year, but the term loan and the credit facility had continued from the last year. Further, the assessee had declared a loss of Rs.1,88,22,670/- in the return filed for the assessment year in question. Lastly, the Assessing Officer had held that Narang Distillery Ltd. is a wholly owned subsidiary of the respondent and had a common management. There is contradiction in the f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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