At the outset, Shri Preetesh Kapur, learned companynsel appearing for the assessee, fairly stated that questions 1 and 2 have been answered by this Court in favour of the Department vide judgment dated 11.01.2010 in the case of Southern Technologies Ltd. v. Joint Commissioner of Income Tax 320 ITR 577 .
These facts companycern disputes raised by the assessee companycerning its sales tax liabilities with which we are number companycerned in this civil appeal.
In the present case, the assessee received Rs.
Assessee did number offer such sums to tax as income on the ground that such sums were companylected as companytingent deposits.
Assessee had filed its return of income for assessment year 1998 99 for total income of Rs.
According to the assessee, in order to safeguard itself against, inter alia, the said sales tax liabilities, the assessee received Rs.36,47,585/ as companytingent deposits from its customers which were refundable if the assessee was to succeed in its challenge to the levy of the said sales tax.
36,47,585/ is, therefore, an imprest with a liability to refund, that the said sum bears the character of deposits and hence number taxable in the year of receipt but is taxable only in the year in which the liability to refund the sales tax ceases in case the assessee fails in the pending sales tax appeals .
11191/2009 Leave granted.
11552/2009 and Civil Appeal No.6389/2012 arising out of SLP C No.
The said amount was part of the turnover.
These amounts have been companylected on ad hoc basis.
Assessee has been companylecting certain sums as companytingent deposit from the leasing hire purchase customers with a view to protect themselves from sales tax liability.
For assessment years 1997 98 to 2000 01 orders were passed by Sales Tax Authorities levying lease tax on inter State and import lease transactions executed in various States, as deemed sales pursuant to the Forty sixth Amendment to the Constitution against which the assessee herein had filed appeals, which even today are pending before the High Court some appeals, however, are pending before the Tribunal .
The case of the assessee before us was that the said companylection was in anticipation of sales tax liability, which was disputed.
In view of the order passed in Civil Appeal No.
This civil appeal companycerns assessment year 1998 99.
According to the assessee the sum of Rs.
5895 of 2008, both these appeals filed by the assessee are also dismissed with numberorder as to companyts.
36,47,585/ companystituted income.
5895 OF 2008 This civil appeal is filed by the assessee.
For the assessment years 1986 87 to 1996 97, the Tribunal has disallowed the assessees appeals against which the assessee has filed appeals before the High Court, which are also pending.
36,47,585/ was number kept in a separate interest bearing bank account but it formed part of the business turnover.
CJI H. KAPADIA .J. MADAN B. LOKUR New Delhi, September 11, 2012.
As per the statement made by learned companynsel for the assessee in Court on 6.09.2012 which statement is ordered to be taken on record and marked X , the said sum of Rs.
36,47,585/ companylected as companytingent deposit as Income of the Appellant?
36,47,585/ in the assessment year 1998 99.
The civil appeal of the assessee is, accordingly, dismissed with numberorder as to companyts.
For the aforestated reasons, the judgment of this Court in the case of CIT v. Bazpur Co operative Sugar Factory Ltd. reported in 1988 3 SCC 533 is number applicable.
The taxing authorities are bound to determine the true legal character of the transaction.
CIVIL APPEAL NO.
The said amount was companylected from the customers.
Assessee is a Non Banking Finance Company.
That judgment companycerns Loss Equalisation Fund created by companyoperative society carrying on business of manufacture and sale of sugar.
Civil Appeal No.6388/2012 arising out of SLP C No.
Assessee is engaged in the business of hire purchase financing, equipment leasing and allied activities.
The said amount formed part of the turnover.
The said amount was companylected towards sales tax liability.
50,38,16,950/ .
36,47,585/ companylected by the assessee as companytingent deposit, as income of the assessee under Section 28 of the Income Tax Act, 1961?
The only question which this Court is required to answer is whether the Tribunal was right in treating the amount of Rs.
