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2019 (4) TMI 1675 - HC - Income TaxDisallowing the expenses of liquidated damages - contingent contract - allowability in year of execution of contract or fulfillment of conditions mentioned in contracts - HELD THAT:- A perusal of clauses of the agreement indicates that the said agreement dated 5th March, 2010 entered into between the Assessee and M/s. Timblo Minerals Pvt. Ltd. was a contingent contract u/s 32 of the Contract Act and could be enforced only when the conditions prescribed therein would have been complied with and not on the date of execution of the agreement. In our view, the Tribunal was thus right in holding that the Assessee was entitled to seek deductions in respect of the said amount in the Assessment Year 2011-12. We do not find any infirmity in the order passed by the Tribunal. Since the rate of income tax in the Assessment Years 2010-11 and 2011-12 being uniform, it was of no consequence to the Revenue whether to allow the said expenditure in the Assessment Year 2010-11 or 2011-12. The issue raised by the Revenue in these Appeals is thus academic and does not give rise to any substantial question of law. Disallowance of the deferred revenue expenditure - Assessee had claimed deduction at the rate of 1/17th of the said expenditure while filing the return of income in the impugned assessment year - Tribunal held that since the liability was as per interpretation of the accrual towards the said expenditure in the Assessment Year 2011-12 and since the Assessees had made payment on 5th March, 2010, and held that the said sum was also not hit by the provisions of Section 40(a)(ia) - HELD THAT:- Tribunal held that following the rule of consistency, deduction to the Assessee amounting to ₹ 9,87,993/- being 1/17th of ₹ 1,67,95,982/- was allowed. These findings of fact rendered by the Tribunal in the impugned order are admittedly not impugned by the Revenue and have attained finality. In our view, the issue raised by the Revenue recorded in paragraph 3(D) aforesaid is also academic and does not raise any substantial question of law.
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