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2023 (7) TMI 1147 - ITAT AHMEDABADNature of expenditure - replacement of Membrane Cells - revenue or capital expenditure - HELD THAT:- We unhesistantingly hold that the ld.CIT(A) has grossly and unjustly erred in confirming the order for treating the expenses incurred of replacement of Membrane Cell as capital in nature despite the assessee demonstrating before him that the issue had been decided in its favour by various judicial authorities in the preceding years. MAT u/s 115JB - addition on account of Prior Period Expenses under the provision of Section 115JB - Whether the said liability was crystallized and quantified during the year? - HELD THAT:- If the impugned expenses do not qualify as prior period expenses, we fail to understand how the same could be eligible for adjustment to the book profits of the assessee as being in the nature of prior period expenses. The findings of the ld.CIT(A) holding the impugned expenses to be not in the nature of prior period expenses, but confirming the adjustment made to the book profits of the assessee as being in the nature of prior period expenses, is nothing but contrary findings. Once the ld.CIT(A) has appreciated the nature of the expenses, categorized by the assessee as prior period expenses, to be not so and categorically held so, the expenses clearly as per the findings of the Ld.CIT(A) do not qualify as prior period expenses. Therefore, there is no question for making any adjustment of the same to the book profits of the assessee by treating them as period expenses.
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