TMI Blog2014 (4) TMI 202X X X X Extracts X X X X X X X X Extracts X X X X ..... e any infirmity in order of learned CIT(A) – Appeal decided against Department. - ITA No. 475/Jodh/2013 - - - Dated:- 24-10-2013 - Shri Hari Om Maratha And Shri N. K. Saini,JJ. For the Petitioner : Shri Shravan Kumar Gupta For the Respondent : Shri N. A. Joshi- D. R. ORDER Per N. K. Saini, A. M. This is an appeal by the assessee against the order dated 04/07/2013 of ld. CIT (A), Udaipur. The following grounds have been raised in this appeal: 1. Deleting the disallowance on account of higher rate of depreciation of Rs. 28,13,262/- claimed on Civil Work for foundation, Electrical equipments and evacuation charges etc. related to wind mill ignoring the fact that (a) Higher rate of depreciation is not at all applicable to foundation work which is basically civil work and not at all part of wind mill. (b) Higher rate of depreciation is similarly not applicable to electrical items, which are ancillary items and not part of wind mill. (c) Evacuation charges has not resulted into acquisition of any depreciable asset to the assessee, least the wind mill and at the maximum this can be intangible assets for which separate rate of depreciation is applicable. 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade by the A.O. on this account. There are neither new material evidences available on records nor any latest decisions on the issue pronounced which is against the holding by CIT (Appeals). Hence we request your goodself to please dismiss the ground of appeal of the department in this respect in the interest of equity and justice. Against the ground no. 2 i.e. deletion of disallowance of depreciation of Rs. 10,63,814/- claimed on civil work of foundation and other. We have to submit that the Ld. CIT (Appeal), Udaipur has discussed the issue in detail at page no. 14 and 15 of his order and has appreciated the arguments, evidences, facts and circumstances of the case in their true perspective and has rightly considered the issue in favour of assessee and accordingly deleted the disallowance made by the A.O. on this account. There are neither new material evidences available on records nor any latest decisions on the issue pronounced which is against the holding by CIT (Appeals). The ratio of judgments relied by the CIT (Appeals) are fully applicable in the present case as the issues are identical. Hence we request your goodself to please dismiss the ground of appeal of the departm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax against foreign commission income was of the assessee because the assessee has not separately charged service tax on services provided to foreign principal customer. This fact is verifiable from the copies of debit notes produced before the Learned Assessing officer at the time of assessment proceedings. In fact, the company has deposited a sum of Rs. 16,39,407/- through various challans during the period under consideration against service tax liability and accordingly the same has been debited to profit loss Account. The expenses of service tax is incurred wholly and exclusively for the purpose of business only. At the time of assessment the Learned Assessing Officer observed that the income was declared in different years though the service tax on such income has been paid in the year under consideration. The Learned Assessing officer has erred at law in allowing the expenditure on the basis of proportionate year wise income declared in account instead of allowing total expenditure claimed by the assessee. Accordingly the Learned Assessing officer has erred at law in disallowing Rs. 8,57,261/- out of Rs.16,39,407/- claimed by the assessee in the assessment of income of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l expenditure for purpose of determination of income from business. The genuineness of this expenditure has not been doubted by the Learned AO. The only objection to the allowability in entirety is that the receipts or income was declared in the preceding year also. As per law, if the expenditure is incurred preliminarily in connection with the assessee's own business, it would still be allowed as deduction even if it ensures to the benefit of someone else. Benefit of expenditure may extend beyond the relevant previous year. It is not necessary that benefit of the expenditure should be limited to the previous year in which the expenditure is incurred' A revenue expenditure incurred during the previous year is deductible even if benefit of expenditure is extended beyond the year of expenditure. The Learned AO has not appreciated in its true perspectives the above proposition before making addition on this account. He further erred at law in disallowing proportionate expenditure on this account without considering the fact that it was the regular and consistent system of accounting that the government taxes have been claimed as expenditure in the year of payment only. In the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the genuineness of the payment for the exclusive purpose of the business and thereby delete the addition made on this account in the interest of equity and justice." 10. Learned CIT(A) after considering the submissions of the assesse observed that the Assessing Officer was not justified in disallowing proportionate expenditure on account of payment of service tax without considering the fact that it was a regular and consistent system of accounting that the Government taxes had been claimed as expenditure in the year of payment only. He further observed that in the business of this nature, the liability of service tax was not settled in the preceding year and the business was conducted since preceding year and continued in the year under consideration. He further observed that there was no change in the nature of business and payment of service tax liability had been claimed as expenditure only on settlement of law and issue of clarification by the relevant department and that the payment was made to the Service Tax Department, Government of India after clarification received from them. Learned CIT(A) further observed that since the service tax payments were the statutory dues ..... X X X X Extracts X X X X X X X X Extracts X X X X
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