PCIT Vs Pancard Clubs Ltd. (Bombay High Court)
The Revenue filed an appeal before the Bombay High Court challenging an order of the Income Tax Appellate Tribunal (ITAT) dated 1 September 2017 for Assessment Year 2011-12. The appeal raised two questions of law:
Whether the ITAT was justified in holding that receipts on account of advance sale of room nights were not revenue receipts, despite the assessee’s principal business being the provision of accommodation and other facilities to tourist members and despite the assessee debiting expenses related to those receipts.
Whether the ITAT was justified in holding that the provision for “Holiday Scheme Surrender Value” was an allowable expenditure.
The High Court examined the issues and found that both questions had already been decided in the assessee’s own cases for Assessment Years 2004-05, 2005-06, 2007-08, and 2009-10 through an order dated 17 February 2017 in Income Tax Appeal Nos. 1515, 1516, 1594, and 1678 of 2014. The Court further noted that the same issues were also covered by earlier decisions in the assessee’s own cases in Income Tax Appeal Nos. 2255 of 2011 and 2290 of 2011, decided on 9 May 2014.
The Revenue’s counsel fairly pointed out that the issues were already covered by these earlier judgments. The Court observed that no distinguishing features had been brought on record that would justify taking a view different from the one adopted in the earlier decisions.
