9911796707
TMI Blog2016 (8) TMI 771X X X X Extracts X X X X X X X X Extracts X X X X ..... ed u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") vide order dated 31/01/2005 and the total loss was determined at Rs. 1,78,99,90,122/-. Aggrieved by the order of the Assessing Officer (AO), assessee carried the matter before the ld.CIT(A), who vide order dated 16/09/2011 (in Appeal No.CAB-I/50/05-06) granted partial relief to the assessee. Aggrieved by the order of the ld.CIT(A), assessee is now in appeal before us and has raised following grounds:- 1. The Learned CIT(A) has erred in fact and in law in confirming the action of the AO in treating an amount of Rs. 1,75,032/- being Right to use land and Rs. 17,33,458/-, being plantation and horticultural expenses as capital expenditure. 2. The Learned CIT(A) has erred in fact and in law in confirming the action of the AO in not allowing amortization of lease charges of Rs. 21,42,722/-. 3. First ground is with respect to disallowance of expenses relating to Right to use of land and plantation and horticultural expenses. 3.1. During the course of assessment proceedings and on perusing the details furnished by the assessee, AO noticed that assessee has claimed expenditure for right of use of land of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar to which ld.AR submitted that the expenses have not been incurred during the year but have been incurred in earlier years and the amortized portion of expenses are claimed. He thus submitted that the expenses be allowed to the assessee. Ld.CIT-DR, on the other hand, supported the orders of AO and ld.CIT(A). 5. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. The issue in the present case is with respect to the disallowance of expenses towards right to use of land and expenses for plantation and horticulture. Before us, ld.AR has submitted that the expenses have not been incurred during the year, but have been incurred in earlier years and the amortised portion of expenses has been claimed. Before us, ld.AR has not placed any order in support of its claim that though the expenses have not been incurred during the year but since the amount has been amortized, the expenditure is allowable. Further, ld.AR also could not controvert the findings of AO and ld.CIT(A). In view of the aforesaid facts, we see no reason to interfere with the order of ld.CIT(A) and thus this ground of Assessee is dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IDC in its favour for a period of 99 years was capital in nature. It was held that the benefit conferred on the assessee by way of leasehold rights for 99 years against lump sum payment of Rs. 2.04 crore was of enduring nature and there was no material on record to suggest that this amount was paid by way of advance rent nor was there any provision for its adjustment towards rent or for its repayment to the assessee. Also, there was no material on record to show that assessee had made advance payment of rent for future years to secure any reduction in the rent payable for future years or for any other business consideration. In the case of United Phosphorus Ltd. (2001) 73 TTJ (Ahd) 404, ITAT Ahmedabad held that there was no material or evidence on record or no stipulation in any of the clauses of the allotment letter issued by GIDC, agreement of license or standard lease agreement, which might in any manner indicate that the amount of premium paid for acquiring leasehold rights for a period of 99 years represented payment of advance rent. On other hand, documents amply and clearly demonstrated that such payment was towards purchase price for acquiring aforesaid leasehold rights for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT(A) has erred in fact and in law in confirming the action of the AO in not allowing amortization of lease charges of Rs. 21,42,722/-. 2. The Learned CIT(A) has erred in fact and in law in confirming the action of the AO in considering amount of Rs. 46,31,47,609/- as appellant's income. 9.1. With respect to ground No.1, both the parties have submitted that ground No.1 raised in the present appeal is identical to ground No.2 of assessee's appeal in ITA No.3075/Ahd/2011 for AY 2002-03(supra) and the submissions made by them while arguing the case for AY 2002-03 would be applicable to the present ground of appeal. 10. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. In view of the submissions of both the parties that the facts and circumstances raised in the present ground being identical to that of ground No.2 raised in assessee's appeal for AY 2002-03(supra), We therefore for the reasons while deciding ground No.2 of assessee's appeal for AY 2002-03(supra) hereinabove and for similar reasons, dismiss this present ground of assessee's appeal. 11. Ground No.2 is with respect to addition of Rs. 41 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... covery in respect of minimum guaranteed quantity is firstly not supported with any evidence. Secondly, even if there was some objection. by the PSUs, that alone was not sufficient reason to not account for income in respect of minimum guaranteed quantities accruing as per contract between appellant and PSUs concerned. Addition of Rs. 46,31,47,609/- is confirmed. As far as alternate plea to allow deduction for the said sum as bad debts/business loss in the year of its waiver is concerned, appellant is to make the claim before-the Assessing Officer in the concerned year for deciding it as per law." 11.2. Aggrieved by the order of ld.CIT(A), assessee is now in appeal before us. 12. Before us, ld.AR reiterated the submissions made before the AO & ld.CIT(A). He further submitted that since the income did not accrue to the assessee and though the assessee was following mercantile system of accounting, the amount could not be considered as its income. He further submitted that though the assessee had accounted for income for AY 2002-03, but the same could not be realized by the assessee and therefore in subsequent year, i.e. AY 2006-07 the amount was claimed as bad debts. He submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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