Income Tax Appellate Tribunal - Chennai
Aircel Cellular Services Limited, ... vs Department Of Income Tax on 19 April, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
'C' BENCH, CHENNAI
BEFORE Dr. O.K.NARAYANAN, VICE-PRESIDENT
AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER
I.T.A. No.433/Mds/2009
Assessment year : 2005-06
M/s. Aircel Cellular The Asst. Commissioner
Services Ltd., of Income-tax,
Fifth floor, Spencer Plaza, Vs. Company Circle-I(1),
769, Anna Salai, Chennai.
Chennai - 600 002.
PAN - AAACR 5136 R
(Appellant) (Respondent)
I.T.A. No.417/Mds/2009
Assessment year : 2005-06
The Deputy Commissioner M/s. Aircel Cellular Services
of Income-tax, Ltd.,
Company Circle-I(1), Vs. Chennai.
Chennai.
(Appellant) (Respondent)
Appellant by : Smt. Anita Sumanth, Advocate
Respondent by : Shri C.V.Pavana Kumar, IRS, JCIT
Date of Hearing : 19th April, 2012
Date of Pronouncement : 19th April, 2012
:- 2 -: ITA 433 & 417/09
O R D E R
PER Dr. O.K.NARAYANAN, VICE-PRESIDENT ITA No.417/Mds/09 is filed by the Revenue and the other appeal in ITA No.433/Mds/2009 is filed by the assessee. The relevant assessment year is 2005-06. These cross appeals are directed against the order of the Commissioner of Income- tax(Appeals)-VIII at Chennai dated 16.1.2009 and arises out of the assessment completed under sec. 143(3) of the Income-tax Act, 1961.
2. The only ground raised in the appeal filed by the Revenue is that the Commissioner of Income-tax(Appeals) has erred in deleting the addition made by the Assessing Officer towards provision for doubtful debts for the purpose of computing the book profits. As rightly held by the Commissioner of Income- tax(Appeals), this issue has been decided in favour of the assessee by the Hon'ble Supreme Court in the case Hcl Comnet Systems and Services Limited (174 Taxman 118). Therefore, this :- 3 -: ITA 433 & 417/09 ground fails. The appeal filed by the Revenue is liable to be dismissed.
3. In ITA No.433/Mds/09, the appeal filed by the assessee, the grounds are raised against the disallowance of the following items as part of the profits for computing the benefits under sec.80IA of the Act :
(i) Sale of scrap ` 41,99,367/-
(ii) Interest received from consumers for delayed payment ` 22,76,498/-
(iii) Income earned from swapping of
term loan borrowed from ` 41,99,367/-
Financial Institution
(iv) Income earned from deposits with ` 68,37,103/-
banks for obtaining guarantee
(v) Other interest income ` 42,450/-
(vi) Miscellaneous income ` 26,654/-
4. In the light of the decision of the Hon'ble Gujarat High Court in the case of Nirma Industries Ltd. v. DCIT (283 ITR 402), we direct the assessing authority to include the interest on delayed payments received from the customers to the extent of `2,22,498/- to the eligible profits for computing the benefits available under sec.80IA. In respect of other items, we are not :- 4 -: ITA 433 & 417/09 inclined to accept the contentions raised by the learned counsel appearing for the assessee. They are all indirect and incidental income of the assessee which cannot be considered as income derived from the operation of the unit eligible for exemption. The Commissioner of Income-tax(Appeals) has rightly rejected the contentions of the assessee in respect of those items in the light of the decisions relied on by him.
5. In result, the appeal filed by the Revenue is dismissed and the appeal filed by the assessee is partly allowed.
Order pronounced on Thursday , the 19th of April , 2012 at Chennai.
Sd/- Sd/- (Challa Nagendra Prasad) (Dr.O.K.Narayanan) Judicial Member Vice-President Chennai, Dated the 19th April, 2012 mpo*
Copy to : Appellant/Respondent/CIT/CIT(A)/DR