1 IN HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS 09TH DAY OF OCTOBER 2015 PRESENT HON BLE MR.JUSTICE VINEET SARAN AND HON BLE MR.JUSTICE B MANOHAR ITA No. 116 OF 2010 (IT) BETWEEN : M/s.Karnataka Instrade Corporation Ltd., Rep. by its Managing Director Sri. M.R.Seetharam (formerly known as M/s.Karnataka Minerals & Manufacturing Co Ltd.,) No.1, GEF Administrative Block, New BEL Road, MSRIT Post, Bangalore 560054. Appellant (By Sri. A.Shankar & M.Lava Advs.,) AND: Asst. Commissioner of Income-Tax, Central Circle-2(2), C.R.Building, Queens Road, Bangalore 560001. Respondent (By Sri. K.V.Aravind & Sri. G.Kamaladhar, Advs.,) 2 This ITA is filed U/S.260-A of I.T.Act, 1961 arising out of Order dated 20-11-2009 passed in ITA No.856/BNG/2009 and MP No.6/Bng/2010 dated 10/2/2010, for Assessment Year 2004-05, praying that this Hon ble Court may be pleased to: i. Formulate substantial questions of law stated therein, ii. Allow appeal and set aside order passed by ITAT Bangalore in ITA No.856/BNG/2009 and MP No.6/Bng/2010 dated 10-02-2010, dated 20-11-2009, in interest of justice and equity. This Appeal is coming on for hearing and reserved for orders on 08/09/2015, this day B.MANOHAR J,. pronounced following: JUDGMENT assessee preferred this appeal under Section 260-A of Income Tax Act, 1961 (hereinafter referred to as Act for short) being aggrieved by order dated 20-11-2009 made in ITA No.856/Bang/2008 and order dated 10-02-2010 made in Misc. Petition No.6/Bang/2010 passed by Income Tax Appellate 3 Tribunal (hereinafter referred to as Tribunal for short) for assessment year 2004-05. 2. assessee is public limited company, manufacturing cement in factory situated at Mathodu village, Hosadurga Taluk. assessee filed return of income on 31-3-2004, declaring income of Rs.2,58,12,218/- after setting off unabsorbed depreciation of earlier years to extent of Rs.3,39,62,012/-. return was accompanied with computation of total income, balance sheet, profit and loss account and relevant schedule. However, Assessing Officer disallowed sum of Rs.2,23,52,396/- towards inventories written off, as assessee did not carry on any business during assessment year 2003-04 and also disallowed various expenditure. Being aggrieved by same, assessee preferred appeal before Commissioner of Income Tax (Appeals) (hereinafter referred to as First Appellate Authority for short). First Appellate Authority 4 partly allowed appeal by allowing expenditure of Rs.20,45,323/-. Being aggrieved by order passed by First Appellate Authority, assessee preferred appeal before Tribunal. Tribunal without going into merits of matter, relying upon order made for assessment year 2000-01 in ITA No.378/Bang/2006 dated 19-09-2008 dismissed appeal, by its order dated 20-11-2009. Subsequently assessee filed Misc.Petition No.6/Bang/2010 for rectification of order dated 20-11-2009 invoking Section 254(2) of Act. said Misc. Petition was also dismissed relying upon order made for assessment year 2002-03 in ITA No.855/Bang/2008 dated 6-2-2009 without going into merits of case. Being aggrieved by these two orders, assessee preferred this appeal. 3. This appeal was admitted on 22-04-2010 on following substantial questions of law: 5 (i) Whether Tribunal was justified in not allowing deduction under Income Tax Act in respect of write off of inventories of Rs.2,23,52,396/-? (ii) Whether Tribunal was justified in law in not passing reasoned order in respect of claim of appellant on facts and circumstances of case? 4. Since appeal filed by assessee for assessment year 2002-03 on which reliance was placed was partly allowed by giving certain benefits to assessee, order passed by Tribunal dismissing appeal and Miscellaneous petition filed by assessee, relying upon order made for assessment year 2002-03 is not sustainable. Hence, Tribunal is directed to reconsider matter afresh for assessment year 2004-05, in light of order made in ITA No.855/Bang/2008, in accordance with law. 6 5. Accordingly, without answering substantial questions of law, this appeal is allowed and remanded to Tribunal for considering matter afresh, in accordance with law. Sd/- JUDGE Sd/- JUDGE mpk/-* M/s.Karnataka Instrade Corporation Ltd. v. Asst. Commissioner of Income-Tax, Central Circle-2(2)