Commissioner of Income Tax vs P.C. Media Systems Ltd.

This appeal u/s 260-A of the income tax Act is directed against the order dated 29.06.2007 passed by the income tax Appellate Tribunal in ITA- 1616/Del/2006 pertaining to the assessment year 2002-03. The Commissioner of income tax (Appeals) had arrived at the conclusion that merely because the assessee was following the mercantile system of accounting, it could not be held that life income had accrued to it. In this case, the issue was of interest income. The Commissioner also concluded that from the facts it was clear that no real income accrued to the appellant and that it was evident from the letters and correspondence with the parties to whom the loans were advanced that the said persons had expressed their inability to pay interest. In these circumstances, the Assessing Officer was held not to be justified in computing notional interest income of Rs. 16,44,307/- at the hands of the assessee. These findings of the Commissioner of income tax (Appeals) have been confirmed by the Tribunal. We see no reason to interfere with these findings. No substantial question of law arises for our consideration. The appeal is dismissed.