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TMI Blog2022 (10) TMI 838X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted by the CIT(A) while granting relief to the assessee. We thus decline to interfere with the order of the CIT(A). Inadvertent mistake as assessee has wrongly offered exempt income received by way of dividend as short term capital gain which is otherwise not taxable in law - CIT-A held that income inadvertently offered as taxable income under the head Short Term Capital Gain is exempt income indeed and not susceptible to taxation - HELD THAT:- CIT(A), in our view, has rightly applied the underlying principles of CBDT Circular No.14 dated 11.04.1955 wherein it was observed that the Department should not take advantage of the ignorance of the assessee and collect more tax without the same being due. Article 265 of the Constitution of India provides that no tax shall be levied or collected except by the authority of law. Acquiescence cannot take away from a party, the relief that he is entitled to. Thus, where the CIT(A) found on facts that the redemption amount of investment also comprises of certain exempt dividend income which has been wrongly offered for capital gain tax, the action of the CIT(A) in granting suitable relief cannot be faulted. In the absence of any re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y denied such claim as revenue expenditure. In parity with the admission of fact of incurring capital expenditure in sync with audited books of account, the Assessing Officer thus treated the expenditure as capital expenditure. The Assessing Officer accordingly granted relief by way of depreciation of Rs.96,52,663/- thereon and consequently increased the assessed income to the extent of Rs.3,61,08,578/- on this score. 5. Aggrieved, the assessee preferred appeal before the CIT(A). The CIT(A) after perusal of expenses, admitted the claim of the assessee to be revenue expenditure to the extent of Rs.3,18,80,573/- but however confirmed the balance amount of Rs.1,43,80,668/- as capital expenditure. Depreciation of Rs.35,95,167/- @ 25% thereon was thus allowed on the expenditure treated to be capital in nature. 6. Aggrieved by the part relief, the Revenue preferred appeal before the Tribunal. The assessee also filed Cross Appeal towards the amount confirmed by CIT(A) to be capital expenditure. 7. The assessee however availed Vivad se Vishwas Scheme, 2020 in its appeal in ITA No.2090/Del/2014 in Assessment Year 2009-10 and thus the appeal of the assessee was dismissed as withdraw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ective heads of expenditure, capitalized part of the same, under the head intangible assets / brand development . No new brand was purchased. The brand development expenses were incurred in the course of existing business of manufacturing and sale of liquor. He placed reliance on the following decisions (i) Empire Jute Company Vs. CIT 124 ITR 1 (SC); (ii) CIT Vs. Siti Financial Consumer Fin. Ltd., 335 ITR 29 (Del.); (iii) CIT Vs. Usha Iron Ferro Metal Corporation Ltd., 296 ITR 140 (Del) (iv) CIT Vs. Salora International Ltd., 308 ITR 199 (Del); (v) CIT Vs. Liberty Group Marketing Division 315 ITR 125 (P H); (vi) Sony India Pvt. Ltd. Vs. DCIT, 315 ITR 150 (AT) (Del.) (VII) CIT Vs. Core Health Care Ltd., 308 ITR 263 (Guj.) 4.3 On perusal of the orders of the authorities below, we find that though during the year the assessee had capitalized a sum of Rs.1,79,77,181/- under the head tangible / know-how and brand development in the books and had claimed depreciation thereon. However, after realizing that the expenses so capitalized are of Revenue in nature, the assessee vide its revised return claimed the same as revenue expense and consequen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l field that the expenditure would be disallowable. If advantage of enduring benefit is in the Revenue field it would be on the Revenue account. The Hon ble jurisdictional High Court of Delhi in the case of CIT Vs. Siti Financial Consumer Fin. Ltd. (supra) has been pleased to hold that advertisement and publicity expenses even when substantial, having been incurred to facilitate business, no advantage in capital field is resulted. Again in the case of CIT Vs. Usha Iron Ferro Metal Corporation Ltd. (supra) the Hon ble jurisdictional High Court of Delhi has been pleased to hold that the expenditure incurred by the assessee towards improving its business was for the expansion of its existing business. Merely because the assessee treated the amount as a capital expenditure in its books, it would not be bound by as there is no estoppels against the law and just assessment is the object of the Legislature under the provisions of the I.T. Act. The first appellate order on the issue is comprehensive and reasoned one to which we fully concur with. The same is upheld. Ground No.2 is accordingly rejected. 9. The issue is thus not res-integra and the identical issue was examined by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to give correct treatment to this income. The Ld. Counsel was aggrieved that the Ld. AO took shelter in the decision of Goetze (India) Ltd. (Supra) and did not allow the lawful claim of the appellant. 5.5.2 Furnishing further details, the Ld. Counsel submitted that the appellant had made investment in mutual funds and as per the relevant schemes, the entire amount of dividend earned was to be reinvested therein and on redemption of the same, the initial investment amount and the dividend reinvested thereon is received by the company. It was submitted that the said amount of Rs.52,32,991/- comprises of original investment and dividend income earned thereon. The Ld. Counsel also informed that accordingly, an amount of Rs.31,46,355/- was shown in the return of income for AY 2010-11 as exempt dividend income. A copy of the details of the dividend income for computation of income for AY 2010-11 was filed before me. The Ld. Counsel filed the bread-up of the same as under: Particulars Date of Invt. Amount Invested Date of Redmp. Amount of Redmp. Div. Reinvest. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the CBDT Circular No.14, dated 11.4.1955, in which it was held that the department should not take advantage of the assessee's ignorance to collect more tax out of him than the liability due to him. Reliance was placed on the Bombay High Court in the case of Balmukund Acharya v. DCIT 310 ITR 310, in which it was held that the authorities under the Act are obliged in accordance with law. Reliance was also made on the following cases: (i) Nirmala L Mehta v. A. Balasubramaniam, CIT (2004) 269 ITR 1 (Bom); (ii) ACIT v. Technofab Engg. Ltd. 2009 TIOL, 664 ITAT (Del); and (iii) CIT v. Ramco International, 332 ITR 0303 (P H). 5.5.4 The Ld. Counsel also pleaded that no new claim based on new facts has been made by the appellant. Reliance was placed on the decision of Punjab Haryana High Court in the case of Ramco International (Supra), in which having referred to the Goetz (India), case it was held that any admissible claim under the . Act can be made during the assessment proceeding through filing of letter and filing of revised return is not mandatory. 5.5.5 Without prejudice, the Ld. Counsel submitted that this claim can be filed before me as the G ..... X X X X Extracts X X X X X X X X Extracts X X X X
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