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TMI Blog2015 (8) TMI 849X X X X Extracts X X X X X X X X Extracts X X X X ..... s only if there is bonafide and complete sale of goods, as evidenced by documents. But no agreements or documents have been produced before us for such verifications The later part of paragraph 4 of the circular No. 760 issued by the CBDT, which we extracted above would be applicable to the facts of the present case as we find that all the authorities have consistently held that there is no proof of actual sale though it is claimed as Sale and Hire Back transaction. As all these are findings of fact, we have no other option but to accept the department's plea and reject the assessee's contention. - Decided against assessee. - Tax Case (Appeal) Nos: 759, 950 and 951 of 2007 - - - Dated:- 21-7-2015 - R Sudhakar And K B K Vasuki, JJ. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 13,07,790 1998-99 - ₹ 1,29,898 It was contended before the assessing officer that the sale and hire back transactions are no different from the regular hire purchase transactions and therefore cannot be treated as loans and advances under the provisions of Interest Tax Act. The assessing officer, however, found that in the present case, certain hire purchase transactions are with the parties who were already in possession of the assets which were the subject matter of hire purchase contract. In cases where the asset is pre-existing with the client, then the hire purchase contract is in effect a loan transaction whereby a loan relatable to the value of the asset is given by the appellant and recovered in installments just li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition for both the years is therefore confirmed. The appellant fails. 5. Consistently, the Commissioner (Appeals) have upheld such orders and the Tribunals have also followed the same. The Tribunal, in the instant case, taking note of the Circular No. 760 issued by the CBDT dated 13.01.1998 came to the conclusion that in the absence of an agreement or document produced by the assessee to prove that it is a sale-cum-hire back transaction, held that the findings of the lower authority that it is a financial transaction in respect of an old asset cannot be found fault with and confirmed the order of the C.I.T. (Appeals). 6. We have heard the learned counsel on either side and perused the orders passed by the Tribunal in all the appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Supreme Court in the case of Sundaram Finance v. State of Kerala (AIR 1996 SC 1178) wherein it has been held as under - If there is a bonafide and completed sale of goods evidenced by documents, anterior to and independent of subsequent and distinct hiring to the vendor, the transaction may not be regarded as a loan transaction even though the reason for which it was entered into was to raise money .... . ... ... .. the intention of the appellant in obtaining the hire-purchase and the alied agreements was to secure the return of loan advanced to their customers, and no real sale of the vehicle was intended by the customer to the appellants. The transactions were merely financing transactions. 5. Accordingly, instead of rout ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Technology Ltd. v. DCIT (supra), the case was decided u/s. 143 (1) of the I.T. Act and thus has no bearing on the issues before us. Similarly in case of Consortium Finance Ltd. v. JCIT (supra), the issue before the Bench was whether lease transaction was genuine or not and thus has no application to the case before us. In New Deal Finance Investments Ltd. v. DCIT (supra), the issue involved was whether depreciation is allowable in case of sale and lease back transactions or not. In Karam Chand Thapar Bros vs. DCIT (Supra), again the issue involved was whether depreciation was allowable in case sale and lease back transaction or not. As far as the case of Harita Finance Ltd. v. ACIT (Supra) is concerned, there new assets were involved a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to interest tax. In these circumstances, we find nothing wrong with the order of the ld. CIT (Appeals) and confirm the same. 10. We are unable to accept the contention of Sri.Vijayaraghavan learned counsel appearing for the assessee that if the sale precedes the Hire Purchase Agreement, it would still fall within the definition of Sale and Hire Back Transaction. The later part of paragraph 4 of the circular issued by the CBDT, which we extracted above would be applicable to the facts of the present case as we find that all the authorities have consistently held that there is no proof of actual sale though it is claimed as Sale and Hire Back transaction. As all these are findings of fact, we have no other option but to accept the depar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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