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2020 (2) TMI 1223 - AT - Income TaxNature of expenditure - claim of guarantee fees paid to Government of Gujarat - revenue or capital - HELD THAT:- As decided in own case [2015 (6) TMI 1096 - ITAT AHMEDABAD] the assessee has certified that no new project was started or commissioned during the year for which above guarantee was paid, and the guarantee fees was in respect of loans for acquisition of capital assets, which were already put-to-use prior to 1.4.2007. The guarantee fees is directed to be allowed as revenue expenditure, subject to verification by the AO of the certificate filed during the appellate proceedings i.e. there was no capital work-in-progress in respect of loans on which guarantee fees was paid. Disallowance of claim of cost of raising finance for specialized job as revenue expenditure - expenditure incurred for securing the use of money for a certain period was revenue expenditure. In the instant case, the assessee has secured the loan by creating a charge (hypothecation of its assets). Hence the ratio of the above mentioned two cases would squarely apply. Accordingly, it is held that the AO was not justified in making the disallowance - Decided against revenue.
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