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TMI Blog2018 (9) TMI 1250X X X X Extracts X X X X X X X X Extracts X X X X ..... (for short "ITAT"). The ITAT, by the impugned order, upheld the order of the CIT(A) who inter alia held the gain arising to the assessee on account of securitization of lease receivables and credited to the Profit & Loss Account of the assessee was a taxable receipt in the current assessment year. Income Tax Appeal No.256 of 2016 is with reference to A.Y. 2002-03 and Income Tax Appeal No.267 of 2016 is with reference to A.Y. 2003-04. 2. In the Memo of Appeal of Income Tax Appeal No.256 of 2016 what is submitted is that the impugned order gives rise to the following substantial questions of law, which read thus: "(1) Whether on the facts and in the circumstances of the case and in law, the Tribunal was right in holding that the amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a inter alia engaged in the business of leasing, hire purchase and other financial activities. According to the appellant, for the financial years 2001-02 ( i.e. Assessment Year 2002-03) the appellant securitized rent receivables from April-2002 to March-2004. The total amount receivable during the aforesaid period was Rs. 10.39 Crores which was securitized at the rate of 10.50% for the net present value at Rs. 9.33 Crores. This amount of Rs. 9.33 Crores was received by the appellant in financial year 2001-02 (A.Y. 2002-03) but which related to the financial years 2002-03 and 2003-04. According to the appellant, this amount of Rs. 9.33 Crores received on securitization, was adjusted against the outstanding rent receivable of Rs. 7.64 Crores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lease receivables. The CIT(A) rejected the argument of the appellant that the gain represented only a notional income by holding that this contention was contrary to the effect given by the appellant themselves in the profit and loss account, where the said amount was credited. The CIT(A) further held that the appellant had entered into a business transaction of securitization of lease receivables, and accordingly, the amount of Rs. 1.69 Crores was chargeable to tax. 7. Being dis-satisfied with the order of the CIT(A), the appellant approached the ITAT. The ITAT vide its order dated 5th May, 2015 also confirmed the addition of Rs. 1.69 Crores for the reasons stated therein. This is how both these appeals have come up before us. 8. We hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account. Taking all this factual material into consideration, the A.O. came to the conclusion that the receipt of Rs. 1.69 crores was taxable as it was a revenue receipt in view of the decision of the Supreme Court in the case of T.V. Sunderam Iyengar (supra). 10. As far as the order of the CIT(A) is concerned, after considering the factual aspects of the matter in paragraphs 6 and 7 therein, the CIT(A) in paragraph 8 held that he found no merit in the contentions canvassed by the appellant. The CIT(A) recorded that the appellant himself had accounted for such receipts as an income in the books of accounts which is contrary to the claim of the assessee that the said sum of Rs. 1.69 crores was only a notional income. The CIT(A) gave a categ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no infirmity in the order passed by the CIT(A) and hence confirmed the same. 12. Looking to all these facts, we fail to see how the questions of law reproduced by us above, give rise to any substantial question of law. The finding given by the A.O. as well as CIT(A) and the ITAT are purely based on the factual aspects of the matter. As noted by the authorities below, the appellant - assessee itself treated the receipt of Rs. 1.69 Crores as an income in their profit and loss account. It was their contention before the authorities below that this receipt was a capital receipt and hence not taxable. This was answered by the authorities below, and in our view correctly so by relying upon the decision of the Supreme Court in the case of the Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can arise therefrom. We, therefore, reject this argument at the very outset on this ground alone. 15. Be that as it may, we must mention that as far as the decision of this Court in the case of Taparia Tools Ltd. (supra) is concerned, the same did not deal with applying the "matching concept" to "income" but rather to "expenditure". Whether the same would apply to the income also, is a wholly different matter and which we are not considering in this Judgment. We must also take note of the fact that the decision of this Court in Taparia Tools Ltd.(supra) was carried in appeal to the Hon'ble Supreme Court and the order of this Court was set aside by the Supreme Court vide its decision dated 23rd March, 2015. This decision of the Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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