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2015 (1) TMI 739 - AT - Income TaxDepreciation on assets of the Vegetable Oil Division - Held that:- Once an asset forms a part of block of assets and the business having been carried on, the depreciation is allowable on the written down value (WDV) comprising of block of assets sole on as the business is being carried on by the Assessee then the condition of user of a particular asset is not applicable under the concept of allowing depreciation on block of assets as once the asset forms a part of block of assets it loses its individual WDV or identity. Accordingly, we hold that the CIT(A) rightly allowed relief for the Assessee and orders of the ITAT have not been set aside or modified by any high forum. - Decided against revenue. Prior period expense disallowed - CIT(A) deleted the addition - Held that:- It has been accepted that as per regular system of accounting followed by the Assessee the disputed expenses are always claimed in the year in which the same are quantified in view of above we inclined to hold that since the liability in respect of entire expenditure arose during the year under consideration. Therefore, the same cannot be disallowed by holding them to be prior period expenditure. Hence, the CIT(A) rightly granted relief for the Assessee and we decline to interfere with the impugned order in this regard. - Decided against revenue. Processing fees paid to banks and financial institutions - Revenue v/s capital expenditure - Held that:- When the processing fee was paid for obtaining a loan for the purpose of business then it is a revenue expenditure and the same could not be disallowed hence the CIT (A) rightly deleted the addition in this regard. - Decided against revenue. Commission paid for processing loans from banks/financial institutions disallowed - CIT(A) deleted the addition - Held that:- Assessee has submitted details of brokerage as well as amount of loan received and the name of the bank of financial institution from where the loans were obtained. Thus, CIT(A) right hold that the respective progress rendered services to the Assessee for obtaining huge amounts of loans from banks and financial institutions. Therefore, the brokerage expenses incurred in this regard has to be allowed as revenue expenditure and the CIT(A) rightly allow the same by deleting the impugned addition.- Decided against revenue. Exchange rate fluctuation - whether CIT(A) erred in not remanding the addition back to the AO and in giving directions to the AO in violation of Section 251 - Held that:- Income for Assessment Year 2002-03 clearly observe that the Assessee has added back a sum of ₹ 64 lakhs in the computation of income for the Assessment Year 2002-03. Further we observe that deduction of ₹ 64 lakhs has been claimed on payment basis during the A.Y 2003-04. Thus, the action of the CIT(A) on this issue is justified which is based on proper analysis of facts. Under theses circumstances, the CIT(A) directed the AO to allow the relief subject to some verification of certain facts and the we are unable to see any perversity, ambiguity or any other valid reason to interfere with the same. - Decided against revenue. Disallowance of brought forward losses and depreciation - Held that:- Assessing Officer has not raised or disputed the issue of brought forward loses and unabsorbed depreciation and the Revenue is not allowed to create or re-open the issue which was not an issue of dispute before the authorities below. - Decided against revenue. Routine expenses dis allowance - Held that:- The issue is restored to the file of Assessing Officer for proper examination and verification in the light of earlier and subsequent assessments of the Assessee. Needless to say that the AO shall provide due to opportunity of hearing for the Assessee during the fresh adjudication of the issue. The Assessing Officer is further directed to consider the explanation, evidence and documents of the Assessee in the light of earlier and subsequent assessment orders of the assessee company in this regard. Decided in favour of assessee for the statistical purpose.
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