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2016 (6) TMI 89 - ITAT CHENNAI

2016 (6) TMI 89 - ITAT CHENNAI - TMI - Disallowance being expenditure incurred towards public issue - Held that:- As decided in case of Brook Bond India Ltd. Vs. CIT [1997 (2) TMI 11 - SUPREME Court] expenditure incurred by a company in connection with the issue of shares with a view to increase its share capital, is directly related to the expansion of the capital base of the company and is capital expenditure, even though it may incidentally help in the business of the company and in the profi .....

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any details regarding the amount advanced to Mr. Anup Kumar. We also do not find it necessary to interfere with the orders of the Revenue because even before us at this stage, the assessee has not furnished any details in regard to the loan extended to Mr. Anup Kumar. Therefore we are not able to ascertain whether the loan was given during the course of the business of the assessee and for the business purpose of the assessee or due to its credit sale. - Decided against assessee.

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terfere with the orders of the Revenue because from the facts of the case it is apparent that the company has invested in the shares of M/s Money Shopee Network Ltd., and shown under the head ‘investment’. Only when such shares are sold, capital gain/loss will arise in the case of the assessee. However in this case before us, the assessee has neither sold the shares nor converted the investment into stock-in-trade. Therefore, we confirm the order of the learned Commissioner of Income Tax (Appeal .....

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ically excludes “any sum received under keyman insurance policy” from the “income which do not form part of the total income” under Chapter III of the Act. Therefore, we hereby confirm the order of the Revenue on this issue.- Decided against assessee. - I.T.A. No. 1057/Mds/2013, I.T.A.No.1564/Mds/2013 - Dated:- 5-5-2016 - Shri N. R. S. Ganesan, Judicial Member And Shri A. Mohan Alankamony, Accountant Member For the Department : Shri P. Radhakrishnan, JCIT For the Assessee : Shri S. Sridhar, Advo .....

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in its Circular No.21/2015 dated 10.12.2015 had instructed its officers to withdraw all the appeals pending before the ITAT where the tax effect is less than 10 lakhs. Therefore, this Tribunal is of the considered opinion that this Circular of CBDT is binding on the officers of the Department. Hence, the Revenue cannot proceed further in this appeal. Accordingly, the appeal stands dismissed. Assessee s Appeal - ITA No.1564/Mds/2013:- 3. Brief facts of the case are that the assessee is a limited .....

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ncome Tax (Appeals) against which the assessee is in appeal before us. 4. In the appeal of the assessee, extensive and elaborate grounds are raised and they are concised and adjudicated herein below:- Ground No.1: Disallowance of ₹ 4,57,200/- being expenditure incurred towards public issue: 5. The assessee has written off ₹ 4,57,200/- as public issue expenses. The assessee had explained before the learned Assessing Officer that, during the relevant assessment year, the assessee had p .....

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ome Tax (Appeals) confirmed the order of the learned Assessing Officer agreeing with his view. 5.1 At the outset, we find that this issue is covered by the Hon ble Apex Court decision cited supra, wherein the Hon ble Apex Court held as follows:- Expenditure incurred by a company in connection with the issue of shares with a view to increase its share capital, is directly related to the expansion of the capital base of the company and is capital expenditure, even though it may incidentally help i .....

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because the conditions laid down in section 36(1)(vi) of the Act was not fulfilled. On appeal, the learned Commissioner of Income Tax (Appeals) confirmed the order of the learned Assessing Officer because the assessee did not furnish any details regarding the amount advanced to Mr. Anup Kumar. We also do not find it necessary to interfere with the orders of the Revenue because even before us at this stage, the assessee has not furnished any details in regard to the loan extended to Mr. Anup Kum .....

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377; 95,00,000/- during the assessment year 1999-2000 as detailed herein below:- i) Paid to Saran Enterprises for early approval and public issue Rs.50,00,000 ii) Paid to Subuthi Finance for placement of shares Rs.20,00,000 iii) Paid to Suhasini Traders for identification of sites, vetting of documents etc. Rs.25,00,000 Total Rs.95,00,000 Out of the total expenditure of ₹ 70,00,000/- incurred during the assessment year 1999-2000 and ₹ 25,00,000/- incurred during the assessment year 2 .....

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urred with respect to the issue of equity shares of the assessee company. On appeal, the learned Commissioner of Income Tax (Appeals) allowed the expenditure of ₹ 12,00,000/- as deduction being 50% of expenditure incurred during the assessment year 2005-06 because it was incurred towards business expenditure and not for the purpose of the expansion of the Capital base of the assessee company. With respect to other expenditures, the learned Commissioner of Income Tax (Appeals) confirmed the .....

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he amount written off as loss on investment: 8. The assessee company had invested in equity shares amounting to ₹ 12,00,000/- in the company M/s. Money Shopee Network Ltd. The assessee company wrote off this amount as loss on investment because that company had become inoperative and the possibility of become operational was ruled out. The learned Assessing Officer disallowed this loss on investment claimed by the assessee because the assessee company did not bring any evidence to substant .....

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