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TMI Blog2019 (1) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... n of industrial undertaking, onus lies on the assessee to prove such claim. Assessee having failed to do so, we are of the opinion that lower authorities were justified in denying the claim u/s.35D - Decided against assessee Disallowance of excise duty element on warranty - Held that:- It might be true that warranty goods manufactured by the assessee, on which it had claimed excise duty as allowable u/s.43B of the Act, remained with the assessee till the warranties were invoked by the customers. However, it is not disputed that warranty goods stood manufactured by the assessee. Assessee had also paid the excise duty thereon to the exchequer. Once the assessee had effected payment of the excise tax, in our opinion assessee could not have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al, which is directed against an order dated 09.01.2015 of ld. Commissioner of Income Tax (Appeals)- VII, Chennai has taken altogether six grounds of which ground No.1 is general needing no specific adjudication. 2. Ground No.2 raised by the assessee reads as under:- 2. Disallowance of Share Issue Expenditure- ₹ 1,19,672/- a. The learned CIT(A) erred in holding that the expenditure incurred in increasing the Share capital is not deductible u/s 35D of the Income Tax Act, 1961. b. The Learned CIT(A) ought to have appreciated that, fees paid to Registrar of companies is for the purpose of increasing the Share capital for extension of industrial unit. c. Further, the Learned CIT(A) failed to appreciate the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udited accounts for the year ended 31st December, 2006. However, assessee for its accounting purpose was following calendar year as its financial year. Ld. Authorised Representative was unable to clarify whether the expansion claimed by the assessee had happened before 1st April, 2006 or after the said date. Once the assessee is claiming that there was an expansion of industrial undertaking, onus lies on the assessee to prove such claim. Assessee having failed to do so, we are of the opinion that lower authorities were justified in denying the claim u/s.35D of the Act. Ground No.2 of the assessee stands dismissed. 6. Ground No.3 raised by the assessee reads as under:- 3. Disallowance of excise duty element on warranty - ₹ 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned with the assessee till the warranties were invoked by the customers. However, it is not disputed that warranty goods stood manufactured by the assessee. Assessee had also paid the excise duty thereon to the exchequer. Once the assessee had effected payment of the excise tax, in our opinion assessee could not have been denied the claim u/s.43B of the Act. We therefore set aside the orders of the lower authorities and allow the claim of C18,10,764/-, being excise tax paid on warranty goods. Ground No.3 of the assessee stands allowed. 10. When ground No.4 is taken, ld. Counsel for the assessee submitted that he was not pressing this ground. Accordingly, ground No.4 is dismissed as not pressed. 11. Ground No.5 raised by the assessee r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese amounts were not transferred from concerned ledger accounts to prior year expenses account. Prior year expenses account comprises of amount paid to Sales tax department on completion of assessment . Even before the ld. Commissioner of Income Tax (Appeals), it seems, assessee did not provide any details. Now the claim before us is that part of the expenditure was sales tax dues actually paid during the previous year relevant to the impugned assessment year. Considering the facts and circumstances, we are of the opinion that the issue can be verified afresh by the ld. Assessing Officer. We set aside the orders of the authorities on the issue of allowability of the claim of prior period expenditure of C3,92,473/- and remit it back t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the lower authorities. 18. We have considered the rival contentions and perused the orders of the authorities below. Reason why ld. Commissioner of Income Tax (Appeals) confirmed the disallowance for expenditure towards gift is reproduced hereunder:- I perused the list of ledger break-up of gift expenses provided by the appellant during the appeal proceedings in the paper book. The entries show wide range of debits varying from ₹ 150/- to ₹ 1,OO,OOO/- without any details, except 'TRFR TO GIFT', 'GIFT FOR CUSTOMER', 'DIWALI GIFT', TRFR FROM MISC. EXP , TRFR FROM ENTERT, GIFT EXP. DBTD TO SALES PRO-TSFRD', 'WEDDING GIFT', MARRIAGE GIFT', 'GIFT FOR VENDOR', etc. On 31.03 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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