2016 (6) TMI 1161

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....ated 30.12.2011. 2. The Assessing Officer (A.O.), relying on the decisions in the case of Solid Containers Ltd. vs. Dy. CIT [2009] 308 ITR 417 (Bom) and CIT v. T. V. Sundaram Iyengar and Sons Ltd. [1996] 222 ITR 344 (SC), brought the principal amount of the loan waiver of Rs. 460.93 lacs - allowed to the assessee during the year by M/s. Karur Vyasa Bank Ltd. and Indian Bank (per the One Time Settlement Scheme (OTS) arrived at with them), to tax u/s. 28(iv) of the Act, which reads as under; the assessee having already disclosed the interest waiver of Rs. 345.17 lacs allowed along with as income u/s.41(1), the same having been allowed as deduction for A.Y. 2008-09: 'Profits and gains of business or profession 28. The foll....

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....m ICICI Bank Ltd. was a term loan for purchasing machinery by the appellant-company. As far as loan from ADCB is concerned AR fairly conceded that said loan was against hypothecation of stock and not a term loan. He admitted that it was a revenue receipt. As the loan sanctioned by the ICICI Bank was not for carrying out business activity of the assessee ratio laid down by the Hon'ble Supreme Court and Hon'ble Bombay High Court in the cases of T. V. Sundaram Iyengar & Sons Ltd. (supra) and Solid Container Ltd. (supra) respectively are not applicable to the facts of the case under consideration. As far as loan from ADCB is concerned, we are of the opinion that same is taxable as it was advanced for stock in trade. In these circumstances, ....