Belark Communication P. Ltd. vs. ITO

Parties Involved

Facts Summary

The appellant, Belark Communication P. Ltd., filed its return of income for the Assessment Year 2014-15 on 29.11.2014, declaring total income of Rs. Nil. The return was processed under section 143(1) of the Income-tax Act, 1961. The case was selected for scrutiny, and statutory notices under sections 143(2) and 142(1) of the Act were issued and served upon the assessee. The assessee furnished the details called for through its Chartered Accountant. After considering the assessee’s submissions, the assessing officer disallowed the interest cost of Rs. 15,61,323/- from the cost of acquisition of shares and assessed the total income at Rs. 17,42,330/-. Aggrieved by the assessment order, the assessee preferred an appeal before the Commissioner of Income-tax (Appeals), who dismissed the assessee’s first appeal ex-parte. The assessee has filed this second appeal on the ground that the Commissioner of Income-tax (Appeals) has erred in disallowing the interest expenses of Rs. 15,61,323/- by rejecting the indexation benefit under section 48 of the Act.…

Legal Issues

• 1. Whether the disallowance of interest expenses of Rs. 15,61,323/- by the Commissioner of Income-tax (Appeals) was justified?

Judgment Outcome

Decided in favour of Assessee.

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