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2015 (5) TMI 827

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..... trial undertaking and includible in the gross total income of the assessee and the question relatable to the profit on the sale of scrap is thus answered in favour of the assesse. Accrual of interest - ITAT deleted the addition - Held that:- there is no dispute to the fact that the assessee-company had passed requisite Board Resolutions not to charge interest from aforesaid 3 parties on the advances given by it to them. Therefore, we hold that the Assessing Officer was not justified to consider that the interest income has accrued to the assessee on the outstanding advances as the assessee has agreed not to charge interest on the outstanding advances before the interest income had accrued to it. - Decided in favour of assesse. Disallo .....

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..... law in approving the deletion of interest accrued in favour of three companies on the ground that before accrual of interest the Board of Directors had waived interest by totally overlooking the fact that in that event there was no justification of showing those interest in the account of the company. (c) Whether the learned Tribunal below committed substantial error of law in treating the expenses on registration and stamp duty as revenue expenditure instead of capital expenditure. In so far as question no.1 is concerned, the learned Tribunal concurred with the views expressed by the CIT(A). The CIT(A) held as follows: As regards sale of scrap , this issue has not been before the ITAT. However the t .....

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..... the case before us, there is no dispute to the fact that the assessee-company had passed requisite Board Resolutions not to charge interest from aforesaid 3 parties on the advances given by it to them. Therefore, we hold that the Assessing Officer was not justified to consider that the interest income has accrued to the assessee on the outstanding advances as the assessee has agreed not to charge interest on the outstanding advances before the interest income had accrued to it. In view of the above, we uphold the order of the Ld. CIT(A) in deleting the aforesaid interest addition of ₹ 1,21,05,788/- made by the Assessing Officer. Therefore, ground No.1 of the appeal taken by the Department is rejected. Mr. Poddar, learned senio .....

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..... stion no.3 is concerned, the views expressed by the learned Tribunal are as follows: 13. Ground No.3 of the appeal is in respect to delete disallowance of registration charges of ₹ 31,32,178/- paid by the assessee in its Real Estate Project relating to Som Datt Plaza, Kanpur. 14. We have heard the Ld. Representatives of the parties. We observe that the Assessing Officer has stated that the assessee claimed administrative expenses of ₹ 1,45,46,257/- and it includes sum of ₹ 31,32,178/- towards Registration and Stamp Duty for the area pertaining to Som Datt Plaza. The Assessing Officer has stated that the assessee has shown rental income in respect of that property and hence, the expenditur .....

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..... registration charges and the stamp duty had been made by the assessee and the question of fact was answered concurrently in favour of the assessee both by the CIT(A) and the learned Tribunal. The amount allowed to be treated as revenue expenditure pertained to that part of the expenditure, which related to the construction raised by the assessee for the purpose of real estate business. Therefore, the investments made were all in the nature of revenue expenditure. If the land purchased is to be allowed as revenue expenditure, can it be said that the stamp duty and the registration charges will be treated as capital expenditure? This is what was sought to be argued before us on behalf of the Revenue. We are, for the aforesaid reasons, o .....

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