IN HIGH COURT OF DELHI AT NEW DELHI Decided on 23rd March, 2015 ITA 103/2015 ITA 105/2015 ITA 106/2015 ITA 104/2015 COMMISSIONER OF INCOME TAX, LARGE TAX PAYER UNIT, DELHI Appellant Through Ms. Suruchi Aggarwal, sr. standing counsel versus INDIAN RAILWAY FINANCE CORPORATION LTD. Respondent Through Mr. S. Krishnan, Adv. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE R.K.GAUBA MR. JUSTICE S. RAVINDRA BHAT (OPEN COURT) % CM Nos.2774/2015, 2776/2015 and 2777/2015 Exemption is allowed subject to all just exceptions. applications are disposed of. ITA Nos.103/2015, 105/2015, 106/2015 and 104/2015 1. revenue is aggrieved by common order of Income Tax Appellate Tribunal dated 18.6.2014 in four assessment years i.e. 2006-7, ITA 103/2015 & conn. Page 1 2007-08, 2008-09 and 2009-10. 2. Issue sought to be urged is with respect to capital recovery of leased assets termed as lease equalisation charges. These relate to rolling stock of Indian Railways, which is owned by assessee and which is on lease finance basis. 3. issue in respect of assessee itself is covered for previous assessment year 2001-02, in its favour. ITAT had followed its previous order for assessment year 2001-02 in its impugned order. ITAT s order for previous year 2001-02 has been affirmed by judgment of this Court in Commissioner of Income, Large Taxpayers Unit V. Indian Railways Finance Corporation Ltd. 362 ITR 548 (Del.). This position is in fact conceded by revenue. Consequently, appeals do not involve any substantial question of law. They are dismissed. 4. In ITA 104/2015, additional issue arises relating to prior interest expenditure claim on account interest for prior period. AO had made addition of 1,10,10,874/-. assessee had contended that on account of retrospective revision of rate of interest which occurred in assessment year in question i.e. AY 2006-07, it was entitled to claim this as legitimate expense. In respect of these, ITAT s final order noticed its direction for assessment year 2002-03 which were in following terms : "5.3.2. From facts available on record it is seen that similar issue has been decided by Hon'ble ITAT in ITA no. 1735/del/2006 for assessment year 2002-03 vide their order dated 28-08-2009 wherein Hon 'ble ITAT has observed as under: "We have considered rival submissions. There is no dispute about allowability of expenses. Only dispute is regarding year of allowability. If Assessing officer is of view that expenses are pertaining to prior ITA 103/2015 & conn. Page 2 period, same are required to be considered for prior and allowed in that year. If it is found that expenses are allowable in this year on basis of crystallization of liability, same may be considered in year under appeal. assessee is therefore, directed to place necessary evidence in support of claim of expenses. Assessing officer on appreciation of evidence may determine year of allowability and allow same in either of year. Following decision of Hon ble ITAT, Assessing officer is directed to determine of allowability and allow in year to which it pertains. 5. ITAT in its impugned order reiterated those directions : 18. We have heard rival contentions and perusal material available on record. Respectfully following ITAT's order for A.Y. 2002-03 herein also we restore issue back to file of assessing officer with same directions. 6. In view of these directions, Court is of opinion that no substantial question of law arises on this aspect for AY 2006-07. All rights and contentions of parties are reserved. 7. appeals of revenue are consequently dismissed. S. RAVINDRA BHAT (JUDGE) R.K.GAUBA (JUDGE) MARCH 23, 2015 vld ITA 103/2015 & conn. Page 3 Commissioner of Income-tax, Delhi v. Indian Railway Finance Corporation Ltd