SHAHABAD COOPERATIVE SUGAR MILLS LTD Vs. CIT, AAYAKAR BHAWAN, SECTOR 13, KARNAL

JUDGEMENT

(1.) This order shall dispose of a bunch of three appeals bearing ITA Nos. 235 of 2009, 105 and 129 of 2012 as according to the learned counsel for the parties, the substantial question of law and the issue involved therein are identical. For brevity, the facts are being extracted from ITA No. 235 of 2009.

(2.) Ita No. 235 of 2009 has been preferred by the assessee under Section 260A of the Income Tax Act, 1961 (in short "the Act") against the order dated 30.1.2009 passed by the Income Tax Appellate Tribunal, Chandigarh Bench "B", Chandigarh (hereinafter referred to as "the Tribunal") in ITA No. 988/Chd/2008 for the assessment year 2001- 02. The appeal was admitted vide order dated 28.4.2010 for consideration of the following substantial question of law:-

(3.) Few facts necessary for adjudication of the present appeal as narrated therein may be noticed. The assessee filed its return of income on 29.10.2001 for the assessment year 2001-02 at a loss of Rs. 69,617/- and the same was processed under Section 143(1) of the Act on 17.7.2002. According to the Assessing Officer the society had credited interest income of Rs. 54,08,245/- under the head 'Current Liability and Provisions' whereas the same had to be credited to the 'Profit and Loss Account'. The Assessing Officer vide order dated 7.11.2007 (Annexure A-3) concluded that the assessee was following mercantile system of accountancy and, therefore, the amount on account of interest receivable was its income. Accordingly, an amount of Rs. 54,08,245/- was treated as income of the assessee. Feeling aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [for brevity "the CIT(A)"]. The CIT(A) vide order dated 18.8.2008 (Annexure A-2) rejected the appeal. Still dissatisfied, the assessee approached the Tribunal by way of appeal who vide order dated 30.1.2009 dismissed the appeal. Hence, the instant Income Tax Appeal.