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TMI Blog2023 (11) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... its debtors, on account of financing of assets, accrued to the assessee in the ordinary course of business and was not in the nature of capital receipt. The record shows that for the AY in issue i.e., 2010-11, the respondent/assessee had entered into an agreement with Shriram for the sale of financial receivables, having an aggregate book value of Rs. 10,11,71,94,000/-, for a consideration amounting to Rs. 9,08,29,87,000/-. As noticed above, the loan portfolio was sold to Shriram. The record shows that there is no dispute concerning the fact that the loan portfolios, concerning forty-five thousand (45,000) borrowers, had been sold to Shriram, and therefore, the difference between the figures [the difference between the value of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant/revenue has assailed the order dated 14.05.2019 passed by Income Tax Appellate Tribunal [in short Tribunal ]. 3. The appellant/revenue has proposed the following questions of law: (i) Whether, on the facts and circumstances of the case, the ITAT was correct in law in restricting the addition on disallowance u/s 14A of the Income Tax Act read with Rule 8D of the Income Tax Rules, to Rs. 78,037/- as against the addition made by the AO of Rs. 7,94,53,077/-, by ignoring the fact that under Rule 8D the disallowance is not to be restricted to the extent of exempt income? (ii) Whether on the facts and circumstances of the case, the Hon ble ITAT was correct in law in deleting the addition of Rs. 103,87,99,712/- corre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondent/assessee was only Rs. 78,037/-. 10. This aspect is covered by the following judgments rendered by various Courts: (a) Pr. Commissioner of Income Tax~6, New Delhi vs. Mcdonald's India Pvt. Ltd, 2018:DHC:6836-DB. (b) Cheminvest Ltd. vs. Commissioner of Income-tax IV (2015) 378 ITR33 (Delhi). (c) Commissioner of Income-tax, Central-I, Chennai vs. Chettinad Logistics (P) Ltd. (2017) taxman 55 (Madras). 11. We may note that a Special Leave Petition was filed, insofar as the decision rendered by the Madras High Court in Commissioner of Income-tax, Central-1, Chennai vs. Chettinad Logistics (P) Ltd. was concerned, which was dismissed on merits by the Supreme Court. 12. Therefore, in our view, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appointed as debt recover [sic recovery] agent and the hypothecated assets against which the loan given by the assessee were in the process of transfer to STFCL. Further, such sales of approximately 24,000 debts take time to get transferred in totality. Further, such sale of actionable claim is out of the purview of the Sales [sic The Sale] of Goods Act. Due to indemnity and condition to recover the enhance [sic enhanced] loss over and above 20% of debts from the assessee till claim made by STFCL. We therefore, [sic are] of the considered view that the sale of debts has not materialized in totality in the relevant year and therefore, the loss claimed on this account is held not crystallized in the relevant year and thus the question of its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent/assessee and Shriram, which is encapsulated in paragraph 38 of the impugned order: 38. After considering the facts in totality, in the light of the sale agreement and various relevant clauses discussed hereinabove, we are of the considered opinion that transaction has taken place during the year under consideration and loss has crystallized during the year under consideration and the assessee is entitled for claim of loss of Rs. 103.87 crores in the year itself. We, accordingly direct the Assessing Officer to delete the addition of Rs. 104.87 [sic 103.87] crores. [Emphasis is ours] 8. However, for the sake of completeness, the Tribunal appears to have also adverted to its decision rendered in Assessment Year ..... X X X X Extracts X X X X X X X X Extracts X X X X
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