- (1.) This appeal has been preferred by the appellant under Section 260A of the Income Tax Act, 1961 (in short, "the Act") against the order dated 31.10.2008, Annexure A.1 passed by Income Tax Appellate Tribunal, Chandigarh Bench, Chandigarh (in short, "the Tribunal') in ITA No.501/CHANDI/2008, for the assessment year 2003-04. It was admitted on 28.4.2010 to consider following substantial questions of law:- "Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified on facts and in law in confirming the findings of the authorities below while denying deduction on account of interest on sticky loans being the interest doubtful of recovery and having been credited to suspense account in view of the established principles of law and that of accountancy as supported by the judgment of Hon'ble Supreme Court of India in the case of UCO Bank vs. CIT, 1999 237 ITR 889 b) Whether on the facts and circumstances of the case, the order of the Income Tax Appellate Tribunal is perverse to the extent of above said grounds/questions of law
(2.) A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. The appellant is a cooperative society - a sugar mill based at Shahabad, District Kurukshetra. It filed its return of income for the assessment year 2003-04 at a loss of Rs. 7,92,15,648/- on 28.11.2003 which was processed under section 143(1) of the Act on 30.12.2003. The return of income was accompanied by a set of income and expenditure account and balance sheet duly certified by the Chartered accountant. A revised return was filed by the assessee on 7.2.2005 declaring net loss of Rs. 7,97,89,834/-. The case of the appellant was selected for scrutiny. The assessee appeared before the Assessing officer and submitted the reply alongwith necessary documents. During the assessment proceedings, the issue before the Assessing officer was regarding receipt of interest as accrued which was not in fact received and thus the appellant kept the same under suspense account. The appellant submitted that the Income Tax Tribunal, Delhi had held in its case for the assessment year 1992-93 that interest recoverable from Cooperative Society was exempt under section 80P (2)(d) of the Act. However, the reply filed by the appellant was not accepted and addition of Rs. 67,67,142/- was made in the income of the appellant, vide order dated 24.3.2006, Annexure A.3. Aggrieved by the order, the assessee filed appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. Vide order dated 15.4.2008, Annexure A.2, the CIT(A) dismissed the appeal. The appellant filed further appeal before the Tribunal. Vide order dated 31.10.2008, Annexure A.1, the Tribunal partly allowed the appeal for statistical purposes only. Hence the instant appeal by the appellant-assessee.
(3.) We have heard learned counsel for the parties and perused the record.;