Golcha Properties (P.) Ltd. Vs. Commissioner of Income-tax - Court Judgment

Excerpt:
- section 2(k), 2(1), 7 & 40 & juvenile justice (care and protection of children) rules, 2007, rule 12 & 98 & juvenile justice act, 1986, section 2(h): [altamas kabir & cyriac joseph, jj] determination as to juvenile - appellant was found to have completed the age of 16 years and 13 days on the date of alleged occurrence - appellant was arrested on 30.11.1998 when the 1986 act was in force and under clause (h) of section 2 a juvenile was described to mean a child who had not attained the age of sixteen years or a girl who had not attained the age of eighteen years - it is with the enactment of the juvenile justice act, 2000, that in section 2(k) a juvenile or child was defined to mean a child who had not completed eighteen years of a ge which was given prospective prospect - appellant was about sixteen years of age on the date of commission of the alleged offence and had not completed eighteen years of age when the juvenile justice act, 2000, came into force - juvenile act, of 2000 has been given retrospective effect by rule 12 of juvenile justice rule, 2007 - as such, accused has to be treated as juvenile under the said act. s.c. agrawal, j. 1. in this reference relating to the assessment year 1967-68 made at the instance of the assessee, m/s. golcha properties private limited, the income-tax appellate tribunal, jaipur bench, jaipur, has referred the following questions for the opinion of this court:'1. whether, on the facts and in the circumstances of the case, the tribunal is justified in holding that the assessment order for the assessment year 1967-68 did not become time barred under sub-section (1) of section 153 of the income-tax act, 1961, in view of the provisions of the explanation (1) to the said sub-section ? 2. whether, on the facts and in the circumstances of the case, the tribunal is justified in holding that the interest income of rs. 5,11,363 had accrued and arisen in favour of the assessee in the previous year relevant for the assessment year 1967-68 ? 3. whether, on the facts and in the circumstances of the case, and on a correct interpretation of the terms of the agreement dated october 31, 1955, and the consent decree dated february 25, 1959, the tribunal is justified in holding that the assessee is not the owner of the cinema styled as maratha mandir and the machinery, plant, furniture, etc., installed in the said building by the assessee-company with its own resources and no depreciation is available to it in respect thereto ? 4. whether, on the facts and in the circumstances of the case, the income-tax appellate tribunal is justified in rejecting the alternative contention of the assessee that the amount spent by the assessee on the construction of the cinema known as maratha mandir and in purchasing the various movable assets installed therein out of its own funds, is neither a capital nor a revenue expenditure ? 5. whether, on the facts and in the circumstances of the case, the tribunal was justified in holding that rule 6c(3) of the income-tax rules, 1962, does not override the provision of section 37(3) of the income-tax act, 1961 ? 6. whether, on the facts and in the circumstances of the case, the tribunal was justified in sustaining the total disallowance of the guest house expenses incurred after august 10, 1966 ? 7. whether, on the facts and in the circumstances of the case, the tribunal is justified in holding that no appeal lies against the levy of penal interest under sections 139 and 215 of the income-tax act before the appellate assistant commissioner of income-tax under section 246 of the income-tax act, 1961 ?' 2. we have heard mr. n.m. ranka, learned counsel for the assessee, and shri r. n. surolia, learned counsel for the revenue.3. mr. ranka has fairly stated that questions nos. 1, 2 and 4 are covered by the decision of this court in d.b. income-tax reference no. 16 of 1978 and d.b. income-tax reference no. 24 of 1978, decided by this court on january 20, 1987 (golcha properties (p.) ltd. v. cjt ), between the same parties. d.b. income-tax reference no. 16 of 1978 related to the assessment year 1965-66 and d.b. income-tax reference no. 24 of 1978 related to the assessment year 1966-67, and these very questions came up for consideration before this court and they were answered against the assessee and in favour of the revenue. for the same reasons, questions nos. 1, 2 and 4 must be answered against the assessee and in favour of the revenue.4. as regards question no. 3, it has been stated by mr. ranka that it is covered by the decision of this court in d.b. income-tax reference no. 16 of 1978, d.b. income-tax reference no. 24 of 1978 and d.b. income-tax reference no. 25 of 1978, decided by order dated january 20, 1987, between the same parties. d.b. income-tax reference no. 25 of 1978 related to the assessment years 1959-60 and 1960-61 and this court had answered the said question against the assessee and in favour of the revenue. for the same reasons, this question must be answered against the assessee and in favour of the revenue.5. questions nos. 5 and 6 are inter-connected and involve interpretation of section 37(3) of the income-tax act, 1961 and rule 6c(3) of the income-tax rules, 1962 which was brought into force on august 10, 1966. sub-section (3) of section 37 of the income-tax act, 1961, runs as under :'notwithstanding anything contained in sub-section (1). any expenditure incurred by an assessee after the 31st day of march, 1964, on advertisement or on maintenance of any residential accommodation including any accommodation in the nature of a guest-house or in connection with travelling by an employee or any other person (including hotel expenses or allowances paid in connection with such travelling) shall be allowed only to the extent, and subject to such conditions, if any, as may be prescribed.'6. in accordance with the terms of the said sub-section, conditions have been prescribed under rule 6c(3) of the income-tax rules, 1962, which provides as under :'no allowance shall be made in respect of expenditure incurred on the maintenance of any residential accommodation in the nature of a guest house unless the assessee maintains a register showing the following particulars.'7. by the said rule, it has been prescribed that allowance shall be made in respect of expenditure incurred on the maintenance of any residential accommodation in the nature of a guest house only if the assessee maintains a register for the particulars prescribed in the said rule. in other words, rule 6c(3) prescribes the conditions subject to which expenditure referred to in sub-section (3) of section 37 would be permissible as an allowable deduction. in our opinion, the tribunal was, therefore, right in taking the view that the assessee could claim deduction in respect of expenditure incurred on the maintenance of a residential accommodation in the nature of a guest house only if it fulfilled the requirements of rule 6c(3) of the income-tax rules, 1962. in that view of the matter, questions nos. 5 and 6 must be answered in favour of the revenue and against the assessee.8. with regard to question no. 7, mr. n.m. ranka has invited our attention to the decisions of this court in cit v. devi chand panmal and barmer disposal auto parts v. cit , wherein this court has taken the view that the question with regard to levy of interest under sections 139 and 217 of the income-act, 1961, could be agitated in an appeal filed by the assessee against the assessment order.9. in view of the aforesaid decisions, it must be held that the tribunal was not justified in holding that no appeal lay against the levy of penal interest under sections 139 and 215 of the income-tax act, before the appellate assistant commissioner of income-tax under section 246 of the income-tax act, 1961. the said question must be answered in favour of the assessee and against the revenue.10. in the result, questions nos. 1, 2, 3, 4, 5 and 6 are answered in the affirmative i.e., in favour of the revenue and against the assessee and question no. 7 is answered in the negative i.e., in favour of the assessee and against the revenue. no order as to costs.