IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM FRIDAY, THE 24TH JULY 2009 / 2ND SRAVANA 1931 ITA.No. 590 of 2009() --------------------- ITA.107/COCH/2004 of I.T.A.TRIBUNAL,COCHIN BENCH .................... APPELLANT/APPELLANT --------------------------------------- THE COMMISSIONER OF INCOME TAX, TRICHUR. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES) SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT(S): RESPONDENT ------------------------- M/S. ROYAL HIRE PURCHASE (P) LTD., ARAFA BUILDING, CHURCH CIRCLE, TRICHUR. THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 24/07/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C .N. RAMACHANDRAN NAIR & C. K. ABDUL REHIM, JJ. -------------------------------------------- I.T.A. No. 590 OF 2009 -------------------------------------------- Dated this the 23rd day of July, 2009 JUDGMENT Ramachandran Nair,J. The main question raised that is liability for interest tax on the interest received as hire charges and finance charges is covered in favour of the revenue by our decision reported in CIT V. KERALA STATE FINANCIAL ENTERPRISES LTD., 220 CTR 286. So far as penal interest on interest received under hire charges is concerned, we have held vide our judgment in ITA No. 57 of 2009, that it has the same character as interest on hire purchase and hence liable. Following the reported judgment above referred and later decision above referred, we set aside the order of the Tribunal and that of the first appellate authority and remand the matter to the assessing officer for recomputation of liability under the Interest Tax Act on receipts attracting tax after issuing notice to the assessee and after serving them a copy of this judgment. (C.N.RAMACHANDRAN NAIR) Judge. kk (C. K. ABDUL REHIM) Judge. 2 3