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2012 (12) TMI 519 - ITAT, DELHIPenalty u/s 271(1)(c)- Expenditure by hotel industry on renovation is a capital or revenue expenditure - Assessee claiming renovation expenditure as revenue expenditure – Assessee file belated return declaring loss - Held that:- As the assessee is not entitled to carry forward loss in these circumstances, there cannot be any intention to disclose more loss. In case of a hotel whether an expenditure on the renovation of hotel premises i.e. restaurant, bar & lounge, corridor, rooms, staircase, entrance lobby etc. is a capital or revenue is a highly debatable issue. In case where two views of the claim of the assessee were possible, the explanation offered by it could not be said to be false. Therefore, merely because the renovation expenditure was claimed by the assessee as a revenue expenditure but treated as capital expenditure by the Revenue would not be sufficient to hold that the assessee either furnished inaccurate particulars or concealed the income follow the decision of SC in Reliance Petro Products Pvt. Ltd. (2010 (3) TMI 80) & Delhi High Court in Zoom Communication Pvt. .Ltd (2010 (5) TMI 34). Decision in favour of assessee.
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