Law:

Section:

Section 263 of the Income-tax Act, 1961 - Revision - Of orders prejudicial to interest of revenue - Assessment year 1995-96 - Where appellate authority had in assessment orders for assessment years relating to 1996-97 to 1998-99, allowed assessee's claim in respect of a lease transaction by order dated 27-1-2005 and in order to get consistent finding about lease transaction for assessment year 1995-96, assessee filed revision petition under section 264 in April 2005, cause of action for filing revision against order of assessment for assessment year 1995-96 arose only by virtue of order dated 27-1-2005 and, therefore, delay of few months in filing revision petition ought to have been condoned [In favour of assessee] The petitioner/assessee entered into an agreement with 'B' for the purpose of transaction of purchase and lease for a period of five years in respect of 5 furnaces of different types. The petitioner had also entered into sublease agreement with 'G' whereby the lessee leased out the same equipment to the latter company for five years. While so, the assessee filed return of income for the assessment year 1995-96 on 29-11-1995 in which it had shown the income excluding sublease income relating to the transaction of lease and sublease entered into between 'B' and 'G' and the same was processed. The department treated the lease agreement as mere financial arrangement and consequently, the claim for depreciation of the machineries said to have been leased out was disallowed in the assessment of 'B'. Consequently, the assessments of the petitioner for the assessment years 1996-97 to 1998-99 were reopened under section 147 and the assessee's claim for payment of lease entered into with 'B' as deduction was disallowed. However, the assessment in respect of sublease rent received by 'G' was not interfered with. The correctness of such assessment for the assessment years 1996-97, 1997-98 and 1998-99 was challenged by the petitioner by filing an appeal and the Commissioner (Appeals) by order dated 27-1-2005 held that the disallowance of capital portion of lease rent paid by 'B' was justified, however, the petitioner would be entitled to deduct the sublease rent…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492