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TMI Blog2012 (9) TMI 449X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant. Mr. Percy Pardiwalla, Senior Counsel with Mr. Divesh Chawla and Mr.Ativ Patel i/by Hariani Co. for the Respondent. JUDGMENT ( Per M.S. SANKLECHA, J.): This appeal by the revenue under Section 260A of the Income Tax Act ( the Act ) is filed against the order dated 13/8/2009 of the Income Tax Appellate Tribunal ( the Tribunal ) in ITA No.3323/Mum./2008 relating to assessment year 2004-05. 2) Being aggrieved, the revenue has formulated the following questions of law for consideration of this Court. (a) Whether on the facts and in the circumstances of the case and in law the Tribunal was justified in holding that the benefit of cessation of liability to repay a loan liability is not taxable u/s. 41(1) of the Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... et like a motor car is not a revenue receipt. Hence, the same is not taxable. 5) The appeal by the revenue to the Tribunal on the aforesaid issue was dismissed by an order dated 13/8/2009. The Tribunal held that the cessation of liability to repay a loan taken to purchase a capital asset does not result in a revenue receipt. Further, the amount of Rs.29.17 lacs was not taxable under Section 41(1) of the Act as the same was not an expenditure incurred in the earlier years. The issue according to the Tribunal was covered in favour of the respondent-assessee by a decision of this Court in the matter of Mahindra and Mahindra Ltd. v. Commissioner of Income Tax reported in 261 ITR 501. Consequently, the Tribunal held that amount of Rs.29.17 lac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt in the matter of Mahindra Mahindra Ltd. (supra).Therefore, he submits that the appeal should not be entertained. 8) We have considered the submissions. The issue arising in this case stand covered by the decision of this Court in the matter of Mahindra Mahindra (supra).The decision of this court in the matter of Solid Containers (supra) is on completely different facts and inapplicable to this case. In the matter of Solid Containers (supra) the assessee therein had taken a loan for business purpose. In view of the consent terms arrived at, the amount of loan taken was waived by the lender. The case of the assessee therein was that the loan was a capital receipt and has not been claimed as deduction from the taxable income in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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