TMI Blog2012 (8) TMI 527X X X X Extracts X X X X X X X X Extracts X X X X ..... available for such a long period, an extension of merely nine days is extremely reasonable. Further, contention of Revenue that assessee should have invested in bonds of National Highway Authority is also not sustainable since choice of investing in one of the two organizations is with the respondent and the appellant revenue contrary to the statue cannot force the respondent to invest only in the bonds of one in preference to the other. Deduction allowed - Decided in favor of assessee Legal and professional charges - dis-allowance - non furnishing of details of expenses - Held that:- It is found that respondent has not submitted the details of the legal and professional expenses allegedly incurred by it viz, reasons for consultation, the dates of consultation and names of the Consultants. Hence, dis-allowance directed - Decided in favor of Revenue Depreciation - dis-allowance - Held that:- same is answered in favor of assessee by decision in case of CIT vs G. R. Shipping Ltd - INCOME TAX APPEAL NO.3731 OF 2010 - - - Dated:- 27-7-2012 - S.J.VAZIFDAR M.S. SANKLECHA, JJ. Mr. Suresh Kumar i/b Ms. Padma Divakar for the Appellant. Dr. K. Shivram with Mr. Rah ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... letter dated 26/9/2008 before the Assessing Officer and in support thereof produced a copy of the letter dated 26/9/2008 for the perusal of this Court. The relevant extract of the letter dated 26/9/2008 is as under: c) Legal Professional Charges :Rs.137500/- During the year 2005-06 the firm has paid a sum of Rs.137500/- towards legal professional fees to different professionals for consultation on various Income tax, Excise, Custom matters . 5) We find that the respondent has not submitted the details of the legal and professional expenses allegedly incurred by it. The letter dated 26/9/2008 merely states that the expenses were incurred towards payment of fees for professional consultation in Income Tax, Excise and Customs matters. However, no details were furnished of the said consultation charges such as the reasons for consultation, the dates of consultation and names of the Consultants. In the circumstances, the Assessing Officer and the Commissioner of Income Tax (Appeals) were correct in disallowing expenditure of Rs.1.37 lacs as the same was not duly supported by evidence. The Tribunal while passing the impugned order has ignored the fact that the details of expendi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erm specified asset, means the amount invested in such specified asset out of capital gains received or accruing as a result of the transfer of the original asset; (b) long-term specified asset for making any investment under this section during the period commencing from the 1st day of April, 2006 and ending with the 31st day of March, 2007, means any bond, redeemable after three years and issued on or after the 1st day of April, 2006, but on or before the 31st day of March, 2007,- (i) by the National Highways Authority of India constituted under section 3 of the National Highways Authority of India Act, 1988 (68 of 1988); or (ii) by the Rural Electrification Corporation Limited, a company formed and registered under the Companies Act, 1956 (1 of 1956) and notified by the Central Government in the Official Gazette for the purposes of this section with such conditions (including the condition for providing a limit on the amount of investment by an assessee in such bond) as it thinks fit; Provided that where any bond has been notified before the 1st day of April, 2007, subject to the conditions specified in the notification by the Central Government in the Official Gazette u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income Tax (Appeals) by an order dated 5/2/2009 dismissed the respondent-assessee's appeal and upheld the order dated 26/9/2009 of the Assessing officer. He held that even in terms of the said Circular the investments in the bonds for the benefit of Section 54EC of the Act had to be made on or before 31/12/2006, whereas the respondent admittedly purchased the REC bonds only thereafter on 31/1/2007. 14) The Tribunal by its order dated 19/6/2010 allowed the respondent's appeal. The Tribunal held that it was impossible for the respondent to comply with the condition of Section 54EC of the said Act as the REC bonds were not available and for that reason the CBDT had issued the Circular dated 30/6/2006 extending the time. Further, the Tribunal held that the fact that the respondent had deposited the amount of Rs.50/- lacs with the State Bank of India with a specific direction that the bonds would be purchased out of the aforesaid amount as soon as they were available, supported the stand of the respondents that the REC bonds were not available. 15) Mr. Suresh Kumar, the learned counsel for the revenue submitted that the Tribunal could not have extended the benefit of Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not lead to injustice. The Apex Court in the matter of Directorate of Enforcement Vs. Deepak Mahajan reported in 1994(3) SCC 440 observed as under: Though the function of the Court is only to expound the law and not legislate, none the less the legislature cannot be asked to sit to resolve the difficulties in the implementation of its intention and the spirit of the law. In such circumstances, it is the duty of the Court to mould or creatively interpret the legislation by liberally interpreting the statue . Therefore, in the present facts, the six months provided for investing in bonds may be reasonably extended in view of the non availability of bonds till 22/1/2007. 19) The contention of the appellant revenue that Rural Electrification bonds were available upto 3/8/2006 and the respondent assessee should have purchased the bonds before 3/8/2006 is not sustainable as the time given by the statue to invest in bonds under Section-54EC of the Act is six months from the date of sale and, therefore, the respondent was entitled in law to wait till 21/9/2006 to invest in the bonds. 20) There remains an important aspect of some difficulty to be considered viz. the extent to and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the bonds were not available for such a long period, an extension of merely nine days is extremely reasonable in the present facts. 23) The first two grounds are, therefore, rejected. At the cost of repetition, we make it clear that we have not expressed any opinion as to the extent and specific period of extension in any other situation, including where the bonds may not have been available only for a day or two prior to the expiry of the six months period. 24) Thirdly, Mr. Suresh Kumar submitted that the respondent in any case could have purchase the bonds of the National Highway Authority which was an alternative mode of investment provided for availing the benefit of Section 54EC. As the respondent-assessee has not chosen to purchase the bonds of National Highway Authority of India it cannot claim the benefit of Section 54EC of the said Act and the amount of Rs.49.36 lacs is correctly chargeable to capital gain tax. 25) This submission is also not well founded. Section 54EC of the Act having given the respondent a choice of investing either in the bonds of Rural Electrification Corporation Limited or the National Highway Authority, the revenue cannot insist that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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