2015 (3) TMI 1421 - HC - Income Tax

High Court of Bombay admits revenue appeals challenging ITAT order on deduction for meals to foreign airlines

The Commissioner of Income Tax, Mumbai-II, Mumbai Versus M/s. The Indian Hotel Co. Ltd.

The High Court of Bombay addressed appeals by the revenue challenging the Income Tax Appellate Tribunal's order. The Court admitted the appeals based on a ... Substantial question of law - disallowance of interest as proposed by AO u/s 36(1)(iii) - as stated all the questions of law have not been answered by any judgment of this Court - HELD THAT:- We have perused the questions of law in Income Tax Appeal [2015 (12) TMI 1881 - BOMBAY HIGH COURT] In the case of same assessee, on similar question Nos.1 & 2, the Tribunal found that loans and advances given by the assessee company to its subsidiary company was raised for the assessment year 1989- 90 and it was decided in favour of the assessee. In the present case, we are concerned with the assessment years 1998-99 to 2002-03. The Tribunal has consistently applied the ratio of its decision rendered for assessment years 1989-90 and assessment year 1997-98 [2013 (2) TMI 601 - ITAT MUMBAI]. We do not find that there is any change in the factual position. The revenue may have preferred an appeal in this Court against the Tribunal's order for those assessment years, but no record of any appeal having been admitted on the questions of law proposed in the present appeal has been produced before us. As we admit these appeals on the following substantial question of law:- “ Whether on the facts and in the circumstances of the case and in Iaw, the ITAT was correct in allowing deduction under section 80HHC with regard to meals supplied to foreign air lines ? ” Issues:1. Challenge to the order passed by the Income Tax Appellate Tribunal by the revenue.2. Questions of law proposed by the revenue.3. Application of Tribunal's decision on loans and advances given by the assessee company.4. Admission of appeals based on substantial question of law regarding deduction under section 80HHC for meals supplied to foreign airlines.Analysis:The High Court of Bombay addressed the appeals brought by the revenue challenging the order issued by the Income Tax Appellate Tribunal in a batch of appeals. Mr. Suresh Kumar, representing the appellant, argued that the questions of law raised were substantial and had not been previously addressed by the Court. The Court, with the assistance of Mr. Suresh Kumar, examined the questions of law in detail. It was noted that the Tribunal had previously ruled in favor of the assessee regarding loans and advances given to its subsidiary company for specific assessment years. The Court found that the Tribunal consistently applied its previous decisions for other assessment years as well, indicating no change in the factual position. There was no evidence presented of any appeal being admitted on the questions of law raised in the current appeal.In line with a previous order related to the same assessee, the Court admitted the appeals based on a substantial question of law regarding the deduction under section 80HHC concerning meals supplied to foreign airlines. The respondent waived service, and the Court directed the Registrar to summon the original record from the Tribunal for inspection. The paper book provided was deemed sufficient for admission purposes, but the Registry was instructed to prepare a complete paper book as per the rules. Additionally, the Registry was required to inform the Tribunal of the appeal's admission along with a copy of the order for further action.