TaxTMI 
TaxTMI 
2020 (1) TMI 1147
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....umbai ("the Tribunal" for short) in Income Tax Appeal No. 1685/Mum/2009 for the assessment year 2003-04. 3. The appeal has been preferred on the following questions which are projected as substantial questions of law:- (A) Whether on the facts and circumstances of the case and in law, the Tribunal was justified in holding that the CIT(A) was correct in deleting Rs. 114.98 crores on account of remission of loan by Govt. of Maharashtra relying upon the decision in the case of M/s. Mahindra & Mahindra Ltd Vs. CIT 261 ITR 501 whereas the fact of the present case is entirely on different footing than the case of M/s. Mahindra & Mahindra Ltd? (B) Whether on the facts and circumstances of the case and in law, the Tribun....
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....llate authority by order dated 25.9.2008 relied upon the Government resolution dated 30.9.2002 and took the view that only an amount of Rs. 46 crores remained interest bearing debt while the residual debt of Rs. 184 crore continued to be interest free debt from the Government of Maharashtra. Following the decision of this Court in Mahindra & Mahindra Ltd Vs. Commissioner of Income Tax [2003] 261 ITR 501, the first appellate authority accepted the contention of the assessee that the onus of establishing that the receipts were chargeable to tax was on the Assessing Officer and held that the aforesaid decision in Mahindra and Mahindra Ltd (supra) squarely applies to the facts of the present case; the entire sum of Rs. 114.98 crores represented....
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.... deleting the addition made on account of remission of loan." 7. Submissions made by learned counsel for the parties have been considered. 8. The first appellate authority had followed the decision of this Court in Mahindra & Mahindra Ltd (supra) in deleting the addition made by the Assessing Officer on account of remission of loan. The decision of this Court in Mahindra and Mahindra (supra) was contested by the revenue before the Supreme Court in Commissioner Vs. Mahindra And Mahindra Ltd [2018] 404 ITR 1. The issue before the Supreme Court was whether waiver of loan by the creditor is taxable as perquisite under Section 28(iv) of the Act or taxable as remission of liability under Section 41(1) of the Act. Supreme Court held as under....
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....its and gains of business profession"- (iv) the value of any benefit or perquisite, whether convertible into money or not, arising from business or the exercise of a profession; 13. On a plain reading of Section 28(iv) of the IT Act, prima facie, it appears that for the applicability of the said provision, the income which can be taxed shall arise from the business or profession. Also, in order to invoke the provision of Section 28(iv) of the IT Act, the benefit which is received has to be in some other form rather than in the shape of money. In the present case, it is a matter of record that the amount of Rs. 57,74,064/- is having received as cash receipt due to the waiver of loan. Therefore, the very first condition of S....
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....a sine qua non that there should be an allowance or deduction claimed by the assessee in any assessment for any year in respect of loss, expenditure or trading liability incurred by the assessee. Then, subsequently, during any previous year, if the creditor remits or waives any such liability, then the assessee is liable to pay tax under Section 41 of the IT Act. The objective behind this Section is simple. It is made to ensure that the assessee does not get away with a double benefit once by way of deduction and another by not being taxed on the benefit received by him in the later year with reference to deduction allowed earlier in case of remission of such liability. It is undisputed fact that the Respondent had been paying inte....