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TMI Blog2018 (9) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of the Hon'ble Bombay High Court [supra] , set aside the order of the CIT(A) and direct the Assessing Officer to delete the addition of ₹ 2,92,31,861/-. - decided in favour of assessee - ITA No. 2514/DEL/2014 - - - Dated:- 30-8-2018 - Shri N. K. Billaiya, Accountant Member, And Shri Kuldip Singh, Judicial Member Assessee by : Shri Ajay Vohra, Sr. Adv Shri Aditya Vohra, Adv Revenue by : Smt. Aanchal Khandelwal, Sr.DR ORDER Per N. K. Billaiya, Accountant Member This appeal by the assessee is preferred against the order of the Commissioner of Income Tax [Appeals]-1, New Delhi dated 11.02.2014 pertaining to assessment year 2006-07. 2. The sum and substance of the grievance of the assessee is that the ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... joint venture company was a business investment for carrying on the business and it was not an investment simpliciter. It is the say of the ld. AR that the intention of the assessee is paramount and has to be considered. In supports of its contention, the ld. AR relied upon several judicial decisions which are placed on record i n the form of paper book. 6. Rebutting the claim of the ld. AR, the ld. DR strongly supported the orders of the lower authorities. 7. We have carefully considered the orders of the authorities below. There is no dispute that the appellant company was incorporated with the following objects: i) To carry on the business of refining, blending processing, storing, transporting, supplying, Selling and distribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e claim of the assessee that the write off represents loss occurred against business investment cannot be brushed aside lightly. There is no dispute that the assessee made investment in furtherance of its objects. 9. The Hon'ble Bombay High Court in a similar case in CIT Vs. Colgate Palmolive [India] Ltd 59 Taxmann.com 139 was , inter alia, seized with the following question of law: Whether on the facts and in the circumstances of the case and in law the Income tax Appellate Tribunal is justified in holding that the loss incurred on the sale of shares of Camelot a wholly owned subsidiary was a business loss when the investment made in the latter was not a business asset but investment for obtaining an enduring benefit? 10. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m of ₹ 5,50,00,000 which was invested by the assessee in the equity of Camelot on March 17, 2003, and which have been used to repay the loan to the assessee-company, amounting to ₹ 5.50 crores, before March 1, 2003, would demonstrate that the purpose of investment was to give a long-term enduring benefit to the assessee. Merely because it was made in the normal course of business, it cannot be termed as anything but long term investment. This conclusion of the Assessing Officer was challenged in the appeal before the first appellate authority and the Commissioner concluded that the main reason for setting up Camelot was to manufacture tooth brushes exclusively for the assessee. Since the assessee was relying on Camelot for manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts of the appellant company. In that case also, the company wrote off loss on sale of shares and the facts of the case in hand show that the assessee could not recover investment amount on liquidation of joint venture company thereby sustaining a loss of ₹ 2,92,23,186/-. 12. Finding parity in the facts of the case in hand with the facts considered by the Hon'ble High Court of Bombay [supra], we respectfully following the decision of the Hon'ble Bombay High Court [supra] , set aside the order of the CIT(A) and direct the Assessing Officer to delete the addition of ₹ 2,92,31,861/-. 13. In the result, the appeal filed by the assessee in ITA No. 2514/DEL/2014 is allowed. The order is pronounced in the open court on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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