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TMI Blog2013 (12) TMI 905X X X X Extracts X X X X X X X X Extracts X X X X ..... to extension of undertaking and is thus eligible for amortization under the provisions of section 35D - Following EID Parry (India) Ltd., Vs. DCIT [2012 (7) TMI 698 - MADRAS HIGH COURT] - where expenditure has been incurred in connection with issue of shares which are directly relatable to expansion to capital base of the company for raising of new projects, it would be allowable u/s. 35D - Decided in favour of assessee. Deduction u/s 80IB - Held that:- The assessee for the first time raised the issue of additional/higher deduction amounting to ₹ 50,61,142/- u/s.80IB before the CIT(Appeals) - This claim was never made before Assessing Officer - Decided against assessee. - I.T.A. No. 342/Mds/2013 - - - Dated:- 21-10-2013 - Dr. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Officer u/s. 35D and restricting the claim of the assessee u/s. 80IB. Aggrieved by the order the CIT(Appeals), the assessee has come in second appeal before the Tribunal. 3. During the relevant AY, the assessee had issued equity shares to the tune of Rs. 61,95,99,594/- by private placements for expansion of project. For arranging the private placement of equity shares, the assessee had paid commissions to the tune of Rs. 6,10,00,000/- and Rs. 1,20,000/- towards legal and consultancy charges. The assessee had claimed the aforesaid expenditure as miscellaneous expenditure in the Balance Sheet and had written off 1/5th i.e., 1,22,00,000/- as preliminary and pre-operative expenses in the Profit and Loss Account. The Assessing Officer obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mill raw materials Rs. 15.00 Crores 4. Investment towards Karnataka project Rs. 7.50 Crores 5. Project Advances Rs. 15.52 Crores The ld. Counsel further submitted that business activities of the assessee-company have increased in subsequent years as is evident from the details of sale turnover and number of Windmills: Fin.Year Sales Turnover No. of windmills 2008-2009 Rs. 25.78 Crores 23 Windmills 2009-2010 Rs. 52.00 Crores 44 Windmills 2010-2011 Rs. 73.13 Crores 57 Windmills The ld. Counsel for the assessee contended that since the expenditure on account of private placement of shares has been incurred for the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show that there has been increase in business of Windmills and consequent increase in higher sales turnover. We are of the considered opinion that with the increase in capital base after issue of additional equity shares by private placement, the assessee-company intends to expand its existing project. This view is strengthened by the fact that the assessee has invested substantial amount in purchase of Machineries etc., Further, with the increase in number of Windmills, the sales turnover of the assessee has increased almost three fold from Financial Year 2008-09 to Financial Year 2010-11. Therefore, the expenditure incurred towards raising of additional equity shares by private placement can be attributed to extension of undertaking an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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