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TMI Blog2008 (8) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... tribunal upheld that disallowance as prospecting expenses were included on expenditure of corporate plan which does not pertain to prospecting expenses. High dismissed the petition on the ground of substantial question of law. Assessee contended that this expenditure was incurred for orientation of the administrative set up and this was in the nature of revenue receipt – SC held that impugned jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and whereunder the appeal preferred by the appellant herein has been dismissed holding that no substantial question of law arose for its consideration. 3. Indisputably, the appellant is a Public Sector Undertaking of the Government of Rajasthan. In the assessment orders in question, which are for the assessment years 1998-99 and 1999-2000 respectively, the Assessing Officer noticed the status ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to by the Assessing Officer in his order, the Commissioner of Income Tax (Appeals) by its order dated 20.8.2003 opined as under: "From the above discussion it can be noted that the development and prospecting charges are incurred for prospecting and development of the mining area, sub-section (2) of section 35E specifically provides that any expenditure incurred wholly and exclusively on any o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee has not been able to prove that the expenses on development falls in the category of exploring, locating or providing deposits of any mineral so as to quality for deduction under section 35E." 6. The Income Tax Appellate Tribunal also took into consideration the application of the provisions of Section 35E(2) of the Income Tax Act, opining: "We have heard the rival submissions and per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income Tax Act. It is not in dispute that had the High Court considered the claim of the appellant in the light of Section 35E(2), it might have arrived at a different conclusion. We, therefore, set aside the impugned judgment and order and remit the matter to the High Court for considering the appellant's appeal afresh on merit. 8. The appeals are disposed of accordingly. - - TaxTM ..... X X X X Extracts X X X X X X X X Extracts X X X X
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