9911796707
TMI Blog2018 (4) TMI 267X X X X Extracts X X X X X X X X Extracts X X X X ..... eneration of power and distillery. It is contended that the appellant-Company has mills in Munoli, Athani, Havalga, Pathri, Gokak and raw sugar refineries in Haldia and Kandla and has taken sugar factories at Panchaganga in Ichalkaranji, Ajinkyatara in Satara and Raibag Sahakari Sakkare Karkhane on lease basis. 3. It transpires that the appellant entered into a lease agreement with Raibag Sahakari Sakkare Karkhane through Government of Karnataka on 16.10.2008 for a period of 30 years beginning from crushing season October 2008 to September 2038 for gross lease rental of Rs. 126 crores. The case of the appellant was selected for scrutiny under CASS and notice under Section 143 (2) was issued on 25.08.20 by the competent officer. On consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent passed under Section 143 (3) read with Section 263 invalid? ii) Whether, in the facts and circumstances of the case, the Tribunal is right in law in treating lease rentals as capital expenditure? 4. Learned counsel Shri Chythanya K.K., appearing for the appellant would submit that the factual aspects of the case was not properly appreciated by the Tribunal. In para 8 of the order of the Tribunal, it has been held that the appellant has entered into sale deed on 16.10.2008 with Raibag Sahakari Sakkare Karkhane for Rs. 126 crores whereas the appellant has entered into a lease deed on Lease, Rehabilitate, Operate and Transfer basis (LROT) for a period of 30 years. The terms and conditions of the lease deed stipulates that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ight of the factual material placed on record by the assessee. 6. In view of the aforesaid submissions made by the learned counsel for the respective parties and perusing the material on record, we are of the considered opinion that the Tribunal failed to appreciate the factual matrix of the case in a right perspective. Indeed, it is not in dispute that the appellant has entered into a lease deed with Raibag Sahakari Sakkare Karkhane on LROT basis for a period of 30 years. It is also pointed out by the learned counsel for the assessee that the lessor has no power to alienate the property during the lease period. The machinery and other equipments installed during the modernization or expansion of the sugar factory has to be handed over to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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