TaxTMI 
TaxTMI 
TaxTMI 
2023 (5) TMI 1329
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....nterest paid on loans raised for business purposes and eligible for deduction u/s 36(l)(iii) of the Act. 2. That the learned Commissioner of Income Tax (Appeals) has also erred both in law and on facts and otherwise too act without jurisdiction in holding that "interest free loans given to directors are perquisites u/s 17 of the Income Tax Act read with Rule 3(7)(i) of the Income Tax Rules' 1962 and also directing the learned Assessing Officer to take appropriate action so as to tax the perquisites under section 17 of the Act read with Rule 3(7)(i) of the Income Tax Rules in the hands of the directors in respect of interest free loans given to directors. 3. That the learned Commissioner of Income Tax (Appeals) has further ....
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....re is no requirement to prefer an appeal. The management did not pay any attention to the directions issued by the CIT(A) pursuant to which notice u/s. 148 of the Act was issued on the director of the assessee company. It was then the management realised its mistake and was advised by the Counsel to file appeal immediately. 6. The Hon'ble Supreme court in the case of Ram Nath Sao Vs. Gobardhan Sao and Others 2002 AIR 1201 has held as under :- 7. In the case of Collector Land Acquisition Vs. Mst. Katiji & Ors. 167 ITR 471 the Hon'ble Supreme Court held as under :- 8. The Hon'ble Supreme Court in the case of N. Balakrishan V. M. Krishnamurthy 7 SCC 123 held as under :- "It must be remembered that in very case of delay, there....
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....directors in respect of interest free loans given to directors. 3. That the learned Commissioner of Income Tax (Appeals) has further erred both in law and on facts and acted without jurisdiction in directing the learned Assessing Officer to take appropriate action for not deducting TDS from the perquisites in respect of interest free loans given to directors. 11. The bone of contention is the following directions of the CIT(A) :- 12. The Counsel vehemently stated that while giving the aforementioned directions the CIT(A) exceeded the powers vested upon him for disposing any appeal before him. It is the say of the Counsel that the CIT(A) has decided something which was not in the grounds of appeal raised before him. 13. Per....
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....als) shall not enhance an assessment or a penalty or reduce the amount of refund unless the appellant has had a reasonable opportunity of showing cause against such enhancement or reduction. Explanation.-In disposing of an appeal, the Commissioner (Appeals) may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the Commissioner (Appeals) by the appellant." 15. In the case in hand after deciding the grounds the CIT(A) directed the AO to take appropriate action for not deducting TDS from the perquisite in respect of interest free loans given to directors and to take appropriate action to tax the perquisites u/s. 17 of ....
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....ng the matter the courts should not lose sight of the fact that by not taking steps within the time prescribed a valuable right has accrued to the other party which should not be lightly defeated by condoning delay in a routine-like manner. However, by taking a pedantic and hyper technical view of the matter the explanation furnished should not be rejected when stakes are high and/or arguable points of facts and law are involved in the case, causing enormous loss and irreparable injury to the party against whom the lis terminates, either by default or inaction and defeating valuable right of such a party to have the decision on merit. While considering the matter, courts have to strike a balance between resu....