TaxTMI 
TaxTMI 
2016 (11) TMI 1187
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.... have been raised for consideration, at the instance of the Revenue :- "1. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the assessee was entitled to account for only the additional finance charges on a cash basis, while it was otherwise following the mercantile the system of accounting and also accounting for the very same transaction on a mercantile basis under the Company Law? 2. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the assessee could be permitted to follow the mercantile system of accounting for the purpose of Company Law and a Hybrid system for the purposes of Income Tax? 3. Wh....
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.... receipt basis and not on accrual basis. Same view was subscribed to, in a judgment, dated 22.06.2015, rendered in Tax Case Appeal Nos.1230, 1232, 1234 of 2007 and 638, 969 and 970 of 2009. Hence, it is agreed on both sides that question Nos.1 and 2 be answered in favour of the assessee and against the Revenue. 4. So far as question No.4 is concerned, it is not in dispute that it is answered against the assessee by the Division Bench of this Court, in the judgment, dated 22.06.2015, rendered in Tax Case Appeal Nos.1230, 1232, 1234 of 2007 and 638, 969 and 970 of 2009. 5. Now, what remains to be considered is question No.3. 6. Question No.3 deals with charging additional finance charges to tax under Section 43D of the Income Tax Act, 1961....
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....nance Company Limited, a company formed and registered under this Act. (2) Subject to the provisions of sub-section (1), the Central Government may, by notification in the Official Gazette, specify such other institution as it may think fit to be a public financial institution; Provided that no institution shall be so specified unless - (i) It has been established or constituted by or under any Central Act, or (ii) Not less than fifty-one per cent of the paid-up share capital of such institution is held or controlled by the Central Government." 7. The assessee does not fall in any one of those categories specified. Consequently, the assessee's case does not fall within the sweep of clause (a) of Section 43D of the Income Tax Act,....