The Commissioner Of Income-Tax vs M/S. Quest Global Engineering ...
2021 Latest Caselaw 1571 Kant

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     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

      DATED THIS THE 15TH DAY OF FEBRUARY 2021

                        PRESENT

         THE HON'BLE MR. JUSTICE ALOK ARADHE

                          AND

     THE HON'BLE MR. JUSTICE NATARAJ RANGASWAMY

                 I.T.A. NO.185 OF 2015
BETWEEN:

1.     THE COMMISSIONER OF INCOME-TAX
       C.R. BUILDING, QUEENS ROAD
       BANGALORE.

2.   THE DEPUTY COMMISSIONER OF INCOME-TAX
     CIRCLE-12(2), RASHTROTHANA BHAVAN
     NRUPATHUNGA ROAD
     BANGALORE-560001.
                                         .... APPELLANTS
(BY MR. K.V. ARAVIND, ADV.,)

AND:

M/S. QUEST GLOBAL ENGINEERING
SERVICES PVT. LTD.,
SECOND FLOOR, PRIMOSE 7B
EMBASSEY TECH VILLAGE
SARJAPURA-MARATHAHALLI OUTER RING ROAD
DEVARABEESANA HALLI
VARTHUR HOBLI, BANGALORE-560103.
                                            ... RESPONDENT
(BY MR. CHYTHANYA K.K. ADV.,)
                             ---
      THIS I.T.A. IS FILED UNDER SEC. 260-A OF INCOME TAX
ACT 1961, ARISING OUT OF ORDER DATED 12.12.2014 PASSED
IN ITA NO.600/BANG/2013 FOR THE ASSESSMENT YEAR 2008-09,
PRAYING TO:
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     (i) FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW
STATED ABOVE.
     (ii) ALLOW THE APPEAL AND SET ASIDE THE ORDER
PASSED BY THE ITAT, BANGALORE IN ITA NO.600/BANG/2013
DATED 12.12.2014 AND CONFIRM THE ORDER OF THE APPELLATE
COMMISSIONER CONFIRMING THE ORDER PASSED BY THE
DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-12(2),
BANGALORE.

     THIS I.T.A. COMING ON FOR HEARING,            THIS     DAY,
ALOK ARADHE J., DELIVERED THE FOLLOWING:

                         JUDGMENT

This appeal under Section 260-A of the Income Tax

Act, 1961 (hereinafter referred to as 'the Act', for short) has

been filed by the revenue. The subject matter of the appeal

pertains to the Assessment Year 2008-09. The appeal was

admitted by a Bench of this Court vide order dated

19.02.2016 on the following substantial questions of law:

"1. Whether the Tribunal was correct in deleting the disallowances made by the AO on provision of loss on derivative contracts without appreciating that the provision for loss cannot be allowed when the actual sales had not even taken place and maturity date of the derivates contracts has not arisen?

2. Whether the Tribunal was correct in deleting the disallowances of provision of loss on derivative contracts made by the AO without appreciating that the assessing officer

relied on the board's instruction No.3/2010 and held that the provision claimed in speculative transaction in nature and hence not allowable?"

2. For the reasons assigned by us in the judgment

passed today in I.T.A.No.133/2013, the substantial questions

of law are answered against the revenue and in favour of the

assessee. In the result, we don to find any merit in this

appeal, the same fails and is hereby dismissed.

Sd/-

JUDGE

Sd/-

JUDGE

RV/SS