9911796707
TMI Blog2010 (5) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... yment we are of the considered view that the expenditure incurred by the assessee is to be allowed as revenue expenditure irrespective of the fact whether any revenue has been generated from those services or not. - ITA NO. 3436 (DELHI) OF 2009 - - - Dated:- 31-5-2010 - SHRI C.L. SETHI, AND SHRI K.D. RANJAN, JJ. Represented By: Shri Devender Singh for the Appellant. Shri Sanjeev Sapra for the Respondent. ORDER Shri C.L. Sethi, The only issue involved in this appeal filed by the Revenue against the order dated May 12, 2009 passed by the Commissioner of Income-tax (Appeals) pertaining to the assessment year 2006-07 is as under : "On the facts and in the circumstances of the case and in law, the learned Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer, the assessee submitted its reply vide letter dated November 25, 2008 explaining the nature of software consultancy services provided by M/s. Derpol Investment Ltd. to the assessee-company. The assessee's explanation has been reproduced by the Assessing Officer in his order. In the reply, the assessee submitted that the assessee had undertaken certain work from M/s. Spice Communication P. Ltd. and to perform and execute such work, the assessee availed of the services of M/s. Derpol Investment Ltd. It was further submitted by the assessee that the services provided by M/s. Derpol Investment P. Ltd. were in the nature of consultancy services and have been utilised to execute the work taken from M/s. Spice Communication P. Ltd. Howev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... munication P. Ltd. It was only after finding the successful amendments and testing in the software as required by its clients, an agreement dated January 3, 2006 was executed with M/s. Derpol Investment Ltd. As per this agreement, these software consultancy services were required to be paid only for one year commencing from January 3, 2006 for the consideration of Rs. 41,22,000. Therefore, the relevant expenditure of Rs. 10,30,500 pertaining to three months falling in the year under consideration were debited in the current year's profit and loss account. The balance expenditure were booked in the profit and loss account of the successive year. A careful study of the agreement, nature of the services, tenure of the services to be provided b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in dispute that the assessee availed of the technical advisory services and assistance from M/s. Derpol Investment Ltd. since the month of January, 2006. The assessee has claimed proportionate charges pertaining to the period from January, 2006 to March, 2006 amounting to Rs. 10,30,500 in the year under consideration. From the agreement and the nature of the services provided by M/s. Derpol Investment Ltd., it is not at all established that the assessee had acquired any asset of capital in nature. The Assessing Officer has alleged that the expenses incurred by the assessee-company are of enduring nature but he has failed to point out as to how and in what manner, the expenses incurred by the assessee for availing of the services of M/s. D ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
