L & T Finance Ltd. v. Dy. CIT (2018) 258 Taxman 282 (Bom.)(HC)

S. 28(i) : Business income –Engaged in business of leasing, hire purchase and other financial activities – Amount was recognized as a profit on securitization of lease receivables in its profit & loss account – Assessable as business income -Matching concept was never even argued or raised before the Tribunal or raised before the High Court cannot be raised first time while arguing before the High Court. [ S.145, 260A ]

Dismissing the appeal of the assessee the Court held that ; assessee NBFC was engaged in business of leasing, hire purchase and other financial activities, which securitized certain amount as rent receivables from April 2002 to March 2004 and adjusted a part of said amount against rent receivable in its books of account and balance amount was recognized as a profit on securitization of lease receivables in its profit & loss account . Amount credited to profit and loss account is held to be assessable as business income .Contention that it was notional gain was rejected . As regards the contention of the assessee that the “matching concept” was not applied by the authorities below.  Court held that in fact, on going through the orders passed by the authorities below, the “matching concept” was never even argued or raised before them. Therefore, this argument can never give rise to a substantial question of law in the facts and circumstances of the present case. (AY. 2002-03 , 2003-04)