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TMI Blog2012 (9) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal erred in not appreciating that the whole basis of the assessee not recognizing interest income from such loans was that the borrowers were in a weak financial position whereas in the year under consideration the AO found that the borrowers had made huge profits and as such these loans could not be treated as non-performing assets?" 2. The assessee is a non-banking finance company registered with the Reserve Bank of India. In the return of income filed for the assessment year 2007-08, it claimed that it was not assessable in respect of any interest on the loans advanced by it in the previous years relevant to the assessment years 1996-97 and 1998-99, on accrual basis, since there was a resolution of the Board of Directors dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y making profits and in this view of the matter, he held that the Assessing Officer was justified in charging interest. He accordingly dismissed the assessee‟s appeal. In his order, the CIT(Appeals) also noted that the Tribunal had decided the dispute in favour of the assessee for the assessment years 1997-98 and 1998-99 because in those years the borrowing companies were in a bad financial position making it impossible to realize any interest from them, whereas that fact-situation does not obtain in the year under appeal in which the borrowing companies were making handsome profits. He noted that the following are the details of the profits earned by the borrowing companies in the year ended 31st March, 2007; (1) Jindal Equipments L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal overlooked the contention of the department that the facts for the year under appeal are distinguishable from those obtaining in the years in which the High Court had held in favour of the assessee. It is submitted by Mr.Deepak Chopra, the learned Standing Counsel for the Revenue, that despite adverting to the submission of the department, the Tribunal erroneously proceeded to hold that there was no dispute that the facts and circumstances in the present year were the same as in the earlier years. This observation of the Tribunal, according to Mr.Chopra, vitiated the finding of the Tribunal and its decision is liable to be struck down as perverse. 6. There is no appearance on behalf of the assessee, despite service of notice. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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