TMI Blog2016 (3) TMI 544X X X X Extracts X X X X X X X X Extracts X X X X ..... /milk products is one and the same. AD has not made out the absence of interlacing of the above. Under the factual matrix of the case, we find the claim of the assessee is allowable - Decided in favour of assessee - I.T.A. No 4863/Mum/2014 - - - Dated:- 10-2-2016 - SHRI C. N. PRASAD, JM AND SHRI RAJESH KUMAR, AM For The Appellant : Ms. Bharti M Singh For The Respondent : Shri Jitendra Jain ORDER PER RAJESH KUMAR, A. M: This appeal by the revenue is directed against the order dated 09.05.2014 of Commissioner of Income Tax (Appeals)-12, Mumbai (Hereinafter called as the CIT(A)) for assessment year 2010-11. The assessee has raised the following grounds of appeal: 1. On the facts and circumstances of the case a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee had entered into a new field of business of producing and supplying of khoa which is entirely different from the business activity carried on by the assessee and thus the issued the show cause notice to the assessee as why the expenditure of ₹ 1,87,16,047/- should not be disallowed as being pre-operating and pre-opening expenditure of capital in nature relating to Mawa Project . The ld. AO framed the assessment at ₹ 1,36,52,408/- under the normal provisions of the Act and ₹ 3,30,06,385/- u/s 115JB of the Act by disallowing the expenditure of ₹ 1,87,16,047/- vide order dated 10.09.2012 by rejecting the submissions of the assessee vide order dated 07.03.2012 on the ground that the expenditure was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld Representatives of both the parties. After hearing both the parties and perusal of the orders of the Revenue Authorities as well as the relevant material placed before us, our adjudication is given in the following paras. 8. Nature of Expenditure: we find that the expenditure in question undisputedly is of revenue nature. The same is evident from the nature of nominal accounts they are accounted in the records of the assessee. By no stretch of imagination the expenditure incurred on accounts of salaries, wages, marketing expenditure, professional fee, travelling etc falls in the capital fields but for the alleged preoperative nature of the claim. Therefore, we have no doubt to treat the impugned expenditure as allowable revenue b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns Brands are not the milk products. 10. Now what is the nature of the 'Mawa'? Is it a milk product or not and if fails in the scope of the assessee's business of not. The undisputed facts include that the 'Mawa' is made up of the milk product and therefore, it is a dairy product and they same is covered within the scope of the declared business of the assessee. We have considered the Ld DRs argument is the preoperative expenditure incurred before a new product is launched constitutes a new business and reject the same. 11. Interlacing of the accounts, management and control: It is a settled proposition in law that so long as there exists the interlacing of the control management, interlacing of the account ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
