TMI Blog2016 (2) TMI 572X X X X Extracts X X X X X X X X Extracts X X X X ..... same as the amount of ₹ 68.50 lacs was erroneously shown as prior period income and had rectified the same subsequently. We find that both the CIT(Appeals) as well as the Tribunal have arrived at concurrent findings of fact. The Revenue has not been able to show that the same is in any way perverse and/or arbitrary. Disallowance of business expenditure - Held that:- We find that the CIT(Appeals) as well as the Tribunal have arrived at findings of fact that the expenses of ₹ 11,65,950/- were incurred for the purposes of Respondent's business. The concurrent finding of fact has not been shown to be in any way perverse and/or arbitrary to give rise to any substantial question of law Additional expenditure relating to aircrafts taken on finance lease - Held that:- It is not disputed before us that the revised return of income was a valid return. In that view of the matter, the Assessing Officer was not justified in not considering the claim only on the ground that the claim of ₹ 25.22 crores for expenditure was made only in the revised return of income. It is not disputed before us that the expenditure as claimed is eligible for deduction under Section 37(1) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mstances of the case and in law the Tribunal is justified in deleting the addition made on account of frequent flyer expenses u/s.115JB of the Act at ₹ 6,91,38,488/- 9) Whether on the facts and in the circumstances of the case and in law the Tribunal is justified in deleting the addition made on account of repair of premises, furniture and fixtures as capital expenditure by the Tribunal at ₹ 2,85,09,245/-? 10) Whether on the facts and in the circumstances of the case and in law the Tribunal is justified in deleting the addition made on account of prior period expenses at ₹ 68,50,425/-? 11) Whether on the facts and in the circumstances of the case and in law the Tribunal is justified in deleting the addition made on account of Directors personal expenses at ₹ 11,65,950/-? 12) Whether on the facts and in the circumstances of the case and in law the Tribunal is justified in deleting the addition made on account of interest income which was treated as business income as against income from other from sources at ₹ 55,42,37,262/-? 13) Whether on the facts and in the circumstances of the case and in law the Tribunal is justified in deleting the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... crafts was extended/renewed for a further period. As a result, the Respondent was not required to redeliver the four aircrafts to the lessor during the subject assessment year. On the basis of the above, the Assessing Officer invoked Section 41(1) of the Act and held that there was cessation of liability and sought to bring the entire amount which was provided for on the above account of ₹ 3.28 Crores to tax. (b) Being aggrieved, the Respondent-Assessee carried the issue in Appeal to the CIT(Appeals). In appeal, the CIT(Appeals) held that there was no cessation of liability as the lease has been extended for a further period. Thus, expenses which are likely to be incurred at the time of redelivery of the four air craft continues and the provision made continues. Thus, there was no occasion to invoke Section 41(1) of the Act and the addition was deleted. (c) On further Appeal by the Revenue, the Tribunal upheld the findings of the CIT(Appeals). The Tribunal by the impugned order holds that as a matter of fact the period of lease has been extended in respect of the four air crafts, and therefore, the provisions made for redelivery expenses could not be said to have cease ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m-3CD to conclude that the amount of ₹ 68.50 lacs was not in the nature of prior period income and deleted the addition. (c) The Revenue being aggrieved carried the issue in Appeal to the Tribunal. The Revenue before the Tribunal did not controvert the findings of the fact arrived at by the CIT(Appeals). The Tribunal, on examination of the order of the CIT(Appeals) upheld the same as the amount of ₹ 68.50 lacs was erroneously shown as prior period income and had rectified the same subsequently. We find that both the CIT(Appeals) as well as the Tribunal have arrived at concurrent findings of fact. The Revenue has not been able to show that the same is in any way perverse and/or arbitrary. (d) Accordingly the question as framed does not give rise to any substantial question of law and therefore, not entertained. 6 Regarding Question 11:- (a) The Assessing Officer disallowed the expenditure of ₹ 11.65 lakhs on the ground that the expenses were incurred not for the purpose of business but on account of its Directors. Thus, not allowed as deduction while computing the profit and gains for business. (b) On Appeal, the CIT(Appeal) found that the expenses h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing these expenses on the part of the Assessing Officer was that it was claimed only in the revised return of income. It is not the case of the Revenue that the revised return of income was invalid. Further, similar expenses when claimed for the assessment years 2007-08 and 2008-09, had been allowed by the Assessing Officer himself treating it to be revenue expenses. The Tribunal upheld the order of the CIT (Appeals). (d) It is not disputed before us that the revised return of income was a valid return. In that view of the matter, the Assessing Officer was not justified in not considering the claim only on the ground that the claim of ₹ 25.22 crores for expenditure was made only in the revised return of income. It is not disputed before us that the expenditure as claimed is eligible for deduction under Section 37(1) of the Act as it has been expended exclusively for the business of the Respondent-Assessee. (e) In the above view, the question as framed does not give rise to any substantial question of law. Accordingly, not entertained. 8 Regarding Question No.15:- (a) During the subject assessment year, the Respondent- Assessee sold five aircrafts which had bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, the amount of ₹ 361.72 Crores being installment payable in the future was never claimed as a deduction/expenditure/loss or trading liability by the Respondent-Assessee. Thus, no occasion arises for the purposes of Section 41(1) of the Act being invoked. Accordingly, the findings of the CIT(Appeals) and Tribunal that Section 41(1) of the Act is not applicable in the facts of the present case is self evident. Therefore, the proposed of question of law as formulated does not give rise to any substantial question of law and not entertained. 10 So far as Question Nos.6,7,9,12 and 13 are concerned, the learned Counsel for the Revenue very fairly states that the questions formulated herein have been dismissed in Revenue Appeal being Appeal No.1159 of 2010 on 6th May, 2014 wherein identical questions have been raised by the Revenue. Insofar as Question No.13 is concerned, we find that the impugned order dismisses the Revenue's appeal by following the binding decision of this Court in Commissioner of Income Tax V/s M/s. Echjay Forgings Pvt Ltd 251 ITR 15. No distinguishing feature in the present fact which would warrant not following the decision of this Court in Echjay For ..... X X X X Extracts X X X X X X X X Extracts X X X X
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