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TMI Blog2022 (1) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore there remains no mistake apparent from record - HELD THAT:- Admittedly, non-consideration of the judgment of the jurisdictional High Court amounts to a mistake apparent from record as held in the case of ACIT vs. Saurashtra Kutch Stock Exchange Ltd [ 2008 (9) TMI 11 - SUPREME COURT] . We are conscious to the fact that the appeal was decided by the ITAT in the case of the assessee [ 2010 (8) TMI 1155 - ITAT AHMEDABAD] rejecting the same in limine on the reasoning that nobody from the side of the assessee presented the case. The issue was decided by the ITAT without going into merit of the facts of the case. Whether there is a mistake apparent from record in the light of the judgment of Hon ble Supreme Court as discussed above, it is pertinent to note that the order of the AO and the learned CIT (A) got merged with the order of the ITAT. Therefore, if any rectification is required of a mistake being apparent from record that can only be effected in the order of the tribunal and not in the order of the AO or the learned CIT (A). However the assessee, has not challenge the order of the ITAT on the reasoning that there is a mistake in the order of the ITAT. To our unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 23,18,866/- be quashed. 2.1 The appellant without prejudice to above submits disallowance of ₹ 23,18,866/- is excessive. The appellant submits that disallowance of Rs, 23,18,866/- be substantially reduced. Your appellant prays for leave to add, alter, amend and/or withdraw all or any of the grounds of appeal before the final hearing of the appeal. 4. The interconnected issue raised by the assessee is that learned CIT(A) erred in confirming the order of the AO by sustaining the disallowance of interest expenses under the provisions of section 36(1)(iii) of the Act. 5. The facts of the case in brief are that the assessee in the present case is a private limited company and engaged in the business of manufacturing of whitening agent. The assessee in the year under consideration has purchased a piece of land from Gujarat Industrial Development Corporation for total cost of ₹ 1,73,25,000/- vide offer cum allotment letter dated 21st January 2011. The assessee was required to make the payment for the purchase of land in the following manner: i. Down payment of ₹ 51,97,500/-. ii. Balance payment of ₹ 1,21,27,500/- in 12 quarterly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it is discernible from the allotment letter issued by GIDC that the land was acquired by the assessee for the purpose of extension of the existing business and therefore contention of the assessee that it is going to establish the manufacturing plant which is not the extension of the business, is contrary to the facts on record. It is also an admitted fact that there was no commercial operation carried out on the impugned land. Therefore, all the preoperative expenses before the commencement of the production should be capitalized. However, in either of the case, the deduction qua the interest is not available under the provisions of law. 5.7 Even, if the contention of the assessee that the land was acquired for the expansion of the business is assumed to be correct, then also the deduction is not available under the provisions of section 36(1)(iii) of the Act. It is for the reason that all the expenses incurred prior to the commercial production have to be capitalized. 5.8 Furthermore, if the land was acquired not to establish the new manufacturing facility, then the interest cannot be considered as for the purpose of business. Likewise, the amount of interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e do not find any infirmity in the order of the authorities below. Thus we uphold the same. Hence the ground of appeal of the assessee is dismissed. 8.3 In the result appeal of the assessee is dismissed Coming to ITA No. 884/Ahd/2014 an appeal by the assessee corresponding to A.Y. 2004-05. 9. The assessee has raised the following grounds of appeal: Your appellant being dissatisfied with the order passed by the Commissioner of Income tax (Appeals) presents this appeal against the same on the following amongst other grounds, 1.0 The CIT(A) erred in upholding order under section 154 framed by the AO where under he rejected application under section 154 made by the appellant. The appellant submits that the mistakes were apparent from the records and fell within purview of section 154. 2.0 The CIT(A) erred in holding the appeal preferred by the appellant was without : o any basis. The observations and the alleged facts stated by the CIT(A) on page No.10 of the order are contrary to the facts. 2.1 The appellant submits that it had pointed out the mistake apparent from the records and further the appellant had provide that unutilized modvat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised no objection if the delay is condoned. Hence, we condone the delay and proceed to adjudicate the issue raised by the assessee on merit. 11. The only issue raised by the assessee is that the learned CIT (A) erred in confirming the order of the AO by treating the unutilized MODVAT credit of ₹ 20,30,909/- as income of the assessee. 12. The facts in brief are that the assessee in its balance sheet as on 31st March 2004 has shown unutilized MODVAT credit amounting to ₹ 20,30,909/- which was added to the total income of the assessee by the AO in the assessment framed under section 143(3) of the Act vide order dated 28th December 2006 by treating the same as income of the assessee. 12.1 On appeal, the learned CIT (A) also confirmed the same vide order dated 8th October 2007. On further appeal, the ITAT also upheld the order of the authorities below vide order dated 16th August 2010 in ITA No. 4375/Ahd/2008 by observing as under: This appeal by the assessee is directed against the order of the learned CIT(A)-VIII, Ahmedabad dated 08-10-2007 for the above assessment year 2004-05. None appeared on behalf of the assessee despite service of the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and therefore, the addition has resulted in taxing twice the amount. However the claim of the appellant is without any factual basis. The appellant has not been able to prove that if has already added the unutilised MODVAT credit in the income statement. The appellant was a specifically asked, during the course of appellate proceedings, to furnish the computation of income filed with the return filed under section 139(1) so that its claim can be examined. However, the appellant has not furnished any detail but in response to the query it is only furnished the copy of assessment order and the grounds of appeal against the order. The mistake is therefore, not apparent from records he appellant is seeking revision of an order which is settled in appeal by \ misrepresenting the facts. It is a settled law that an order cannot be revised under section 154 if the mistake is not apparent from record. It is clear from these facts that there is no basis in the appeal of the appellant and therefore, the ground No.2.0 of appeal is dismissed. 13. Being aggrieved by the order of learned CIT (A) the assessee is in appeal before us. 14. The learned DR before us vehemently supported the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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