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2020 (2) TMI 984 - AT - Income TaxDisallowance of expenditure toward Special Purpose Vehicle u/s 37 - HELD THAT:- As decided in own case [2018 (10) TMI 1120 - ITAT AHMEDABAD] compensation is proportionate to area of illegal mining outside the leased area and that the assessee has paid the proportionate compensation for mining in the areas outside the sanctioned area allotted to it and that 10% of sum is to be transferred to SPV and the balance 10% is to be reimbursed to the respective lessees, according to us, proves that it is a payment made as ‘compensation’ for extra mining, without which the assessee could not have resumed its activities. Therefore, we are inclined to accept the contention of the assessee that it is compensatory in nature and is a ‘business expenditure’ and is allowable u/s 37(1) of the Act. Addition made towards ‘mine closure obligation’ - ascertained liability OR not ? - HELD THAT:- As decided in own case [2017 (5) TMI 1714 - ITAT HYDERABAD] Mine closure obligation is not a contingent liability but an ascertained liability. Since the quantum of such ascertained liability has to be determined year-wise, we direct the assessee to furnish the relevant data to the Assessing Officer towards mines closure obligation. The Assessing Officer shall verify such data and recompute the disallowance, if any, warranted, in accordance with law and after giving reasonable opportunity of hearing to the assessee. Decided against revenue
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