9911796707
TMI Blog2007 (11) TMI 619X X X X Extracts X X X X X X X X Extracts X X X X ..... ough partnership with private enterprises, either as joint sector or as associate sector or as escort sector. During the course of its business for the assessment year 1994-95 the assessee claimed to write off a sum of ₹ 8,98,706 being the pre-project expenses in respect of 13 projects. Those projects were being promoted by the assessee in joint venture. The assessing officer found that the projects were yet to come up and there was no situation to warrant that the projects have been shelved. He disallowed the claim as pre-matured. For the assessment year 1999-2000, the assessee made a similar claim in a sum of ₹ 18,31,054, which was allowed by the assessing officer. 3. The assessee filed appeals in respect of both the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel appearing for the revenue submitted that this court in somewhat similar set of facts in the case of E.I.D. Parry (India) Ltd. v. (2002) 257 ITR 253 (Mad) observed that when the assessee incurred the expenditure for the purpose of setting up a new project, it was clearly in the capital field and not in the revenue field. The abandonment of that project was the abandonment of a project on which capital expenditure had been incurred. The expenditure incurred on that capital project was not something which could be regarded as revenue expenditure laid out exclusively and wholly for the purposes of business of the assessee as what the assessee was trying to start was a new business for the manufacture of a new product. The expenditure i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of technical consultancy or the like and earned profits. If, however, the project was unsuccessful, the assessee company wrote off the expenses. In its assessments for 1966-67 and 1967-68 the assessee claimed deduction of the sum of ₹ 9,865 and ₹ 10,785 respectively which were project expenses incurred by it in a newsprint paper mill project which did not materialise. The Tribunal held that as the asscssee's business was; promotion of new ventures, the project expenditure was incidental to the business and hence could not be treated as preliminary or capital in nature and accordingly, allowed the same. The revenue carried the matter on appeal before this court. This court, after analysing the various judgments, ultimately h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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