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2011 (2) TMI 703 - ITAT, MUMBAINon-compete fees - Capital expenditure - The facts are exactly similar to the facts in the case of Tecumseh India (P.) Ltd. vs. Addl. CIT considered by the Special Bench of ITAT, Delhi (2010 -TMI - 205282 - ITAT, DELHI) wherein the said claim of noncompete fees was considered and held as capital in nature. It was the submission that the CIT(A) erred in allowing the same as revenue expenditure. Delayed payment of PF/ESIC - This issue is crystallised by the jurisdictional High Court in the case of CIT vs WMI Cranes Ltd (2007 -TMI - 77782 - BOMBAY HIGH COURT) - Respectfully following, the ground raised by the Revenue is rejected. Interest u/s 36(i)(iii) - the A.O. has disallowed proportionate amount of interest from interest free advances given to subsidiaries and associate concerns. It has been stated by the appellant that no loans were given to the subsidiaries or associate concerns and the balance was only the build up of the regular trade transaction with those concerns. The appellant has filed details showing that there were regular transaction with those concerns including purchases made or advances given against purchases including bill discounting and reimbursement of expenditure - The appellant has further drawn my attention to the Supreme Court decision in the case of S.A. Builders (2006 -TMI - 3364 - SUPREME COURT) - Decided in favour of assessee. Disallowance u/s. 40(a)(i)- no material is brought on record by the revenue to contradict the factual observations made by the Assessing Officer. It is neither the ground of the revenue that the factual recordings by the CIT(A) were wrong and the issue should be set aside to the Assessing Officer for fresh adjudication on these facts - The only ground of disallowance seems to be that the assessee company has given loans and advances to its subsidiaries and related parties without charging any interest - The test laid down by the Hon'ble Supreme Court in the case of SA Builders has been correctly applied by the first appellate authority - Decided in favour of assessee.
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