9911796707
TMI Blog2016 (10) TMI 355X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee from the angle as to whether the same were in the nature of revenue or capital expenditure, the matter has been restored to the Assessing Officer to look into the nature of the expenses and consider as to whether the same are allowable under Section 36(1)(iii) or Section 37 of the Act. Merely because the expenses have been capitalized in the books of account, the same cannot be a final wording in the tax proceedings unless these entries of books of account are in consonance with the IT provisions. - Decided in favour of the assessee and against the revenue - Tax Appeal No. 232, 233 of 2006 - - - Dated:- 14-6-2016 - KS Jhaveri And G. R. Udhwani, JJ. Mrs Mauna M Bhatt, Advocate for the Appellant Mr. Hardik V Vora, Ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has erred in upholding the decision of CIT(A) with regard to deleting the addition on account of revenue expenditure being capital in nature. She submitted that the assessee itself had debited the same as capital expenditure in its books of accounts and therefore it cannot change its stand later on. Relying upon a decision of the Apex Court in the case of Commissioner of Income Tax, Central, Bombay vs. Jalan Trading Co. P. Ltd reported in (1985) 155 ITR 536 (SC) wherein it is held that since the assessee was a new company and it had no other business and it acquired under the assignment the right to carry on the business of sole selling agency on a long term basis subject to renewal of the agreement stipulating to pay 75 per cent of its an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elied upon a decision of the Tribunal in the case of United Phosphorus Ltd. and observed that merely because the expenses have been capitalized in the books of account, the same cannot be a final wording in the tax proceedings unless these entries of books of account are in consonance with the IT provisions. 8. The facts in the case of Ghanshyam Steel Work Ltd (supra) are quite similar. This Court in the said case observed as under: 7. Thus, both, the Tribunal as well as Commissioner (Appeals), have recorded concurrent findings of fact and come to the conclusion that the so called new unit was merely an expansion of the existing business of the assessee and was not setting up of a new business and as such the expenses incurred in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
