TMI Blog2010 (5) TMI 831X X X X Extracts X X X X X X X X Extracts X X X X ..... owable as revenue expenses. Considering the fact that the AO had not considered the claims of each of the items of expenditure incurred by the assessee from the angle as to whether the same were in the nature of revenue or capital expenditure, the matter has been restored to the AO to look into the nature of the expenses and consider as to whether the same are allowable u/s 36(1)(iii) or Section 37. In the circumstances, no infirmity can be found in the approach adopted by CIT (A) as confirmed by the Tribunal so as to warrant interference. The appeals are, accordingly, dismissed. - MR. D.A. MEHTA MS. H.N. DEVANI JJ. FOR THE APPELLANT: MRS MAUNA M BHATT COMMON ORAL ORDER (Per: HONOURABLE MS.JUSTICE H.N.DEVANI) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he years under consideration, the assessee started construction of a new unit in a separate plot, adjacent to its existing unit. For this new unit, the assessee borrowed funds and also collected funds through public issue of equity shares. The assessee incurred expenses of ₹ 27,90,138/-, ₹ 19,81,792/- and ₹ 1,05,73,889/- respectively in Financial Years 1995-96, 1996-97 and 1997-98, in relation to the said unit. All these expenses were capitalized in the books of account and shown as pre-operative expenses. However, while filing the returns of income, the said expenses were claimed as revenue expenditure. Since these expenses had been incurred for the new unit which was a separate unit from the existing unit and the new ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irected the Assessing Officer to look into the details of expenses in all the three years and consider their allowability under Sections 36(1) (iii) and 37 of the Act. (6) As can be seen from the impugned order of the Tribunal, the Tribunal has, upon appreciation of the evidence on record, recorded the following findings of fact: 9. We have heard the learned DR and perused the orders of the lower authorities and the material available on record. In the instant case the assessee is engaged in the business of manufacturing equipments and the assessee has also set up a new unit in an adjacent plot of manufacture of the same product. The A O was of the opinion that this setting up to the new unit tantamount to setting up of a new busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng business of the assessee and was not setting up of a new business and as such the expenses incurred in this regard were allowable as revenue expenses. Considering the fact that the Assessing Officer had not considered the claims of each of the items of expenditure incurred by the assessee from the angle as to whether the same were in the nature of revenue or capital expenditure, the matter has been restored to the Assessing Officer to look into the nature of the expenses and consider as to whether the same are allowable under Section 36(1)(iii) or Section 37 of the Act. In the circumstances, no infirmity can be found in the approach adopted by Commissioner (Appeals) as confirmed by the Tribunal so as to warrant interference. No question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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