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2016 (10) TMI 355 - HC - Income TaxNature of expenditure - revenue or capital - main ground for disallowance of the expenses by the Assessing Officer was that the said expenses were capitalized in the books of accounts of the assessee - Held that:- As decided in Ghanshyam Steel Work Ltd [2010 (5) TMI 831 - GUJARAT HIGH COURT] the so called new unit was merely an expansion of the existing business of the assessee and was not setting up of a new business and as such the expenses incurred in this regard were allowable as revenue expenses. Considering the fact that the Assessing Officer had not considered the claims of each of the items of expenditure incurred by the assessee from the angle as to whether the same were in the nature of revenue or capital expenditure, the matter has been restored to the Assessing Officer to look into the nature of the expenses and consider as to whether the same are allowable under Section 36(1)(iii) or Section 37 of the Act. Merely because the expenses have been capitalized in the books of account, the same cannot be a final wording in the tax proceedings unless these entries of books of account are in consonance with the IT provisions. - Decided in favour of the assessee and against the revenue
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