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2016 (8) TMI 610 - BOMBAY HIGH COURT

2016 (8) TMI 610 - BOMBAY HIGH COURT - TMI - Disallowance made on account of survey charges - Tribunal deleted addition - Held that:- We find that the impugned order of the Tribunal has deducted the disallowance on a finding of fact that the tax has already been offered on the same for the Assessment Year 1999-2000 on receiving it from the successful bidder. No substantial question of law. - Deprecation on transactions relating to lease of assets - Held that:- Tribunal allowed the Respondent .....

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ecific direction that the Assessing Officer would examine the sale and lease back transactions entered into by the Respondent-Assessee with the three parties and decide the issue afresh, keeping in view the decision of the Delhi High Court in CIT v/s. Cosmo Films Ltd. [2011 (7) TMI 32 - DELHI HIGH COURT] - Decided against revenue - Allocation of expenses on estimate basis - Tribunal directing the AO to treat 50% of the expenses as capital and the remaining 50% expenditure as revenue expendit .....

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Emerald Co. Ltd.[2005 (9) TMI 50 - BOMBAY High Court ]. Moreover, we find that the impugned order itself records the fact that the Appellant-Revenue had before the Tribunal accepted the fact that the issue raised herein, stands concluded in favour of the Respondent-Assessee - Income Tax Appeal No. 498 of 2014 - Dated:- 8-8-2016 - M. S. Sanklecha And A. K. Menon, JJ. For the Appellant : Mr. Ashok Kotangle with Ms. Padma Divakar and Mr. Arun D. Nagarjun For the Respondent : Mr. Nishant Thakkar i/ .....

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y charges amounting to ₹ 19,75,520/without appreciating that the assessee is following Mercantile System of accounting and the said amount has been shown as receivables in the books of account and is not allowable as per the provisions of the Act? (b) Whether the Tribunal was justified in law in confirming the decision of CIT(A) in deleting the disallowance of deprecation in respect of underlying assets, without appreciating that the lease transactions were transactions of finance/ loan on .....

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e a sum was retained by the lessor for the security of the leased equipments, whereas in the present case, some of the assets were retained in the name of lessor for securing the financed amount? (d) Whether the Tribunal was justified in law in confirming the decision of the CIT(A) in allocating the expenses on estimate basis and directing the AO to treat 50% of the expenses as capital and the remaining 50% expenditure as revenue expenditure, without appreciating that for every claim of deductio .....

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ds related to purchase of shares would be deducted out of dividend income? . 3 Re: Question (a): (i) The Respondent-Assessee was engaged to implement the port Development Programme of the State of Maharashtra. For the aforesaid purpose, the Respondent-Assessee had incurred expenses with regard to the survey, preparing of offer documents, evaluation of bids for the development of minor ports etc., These expenses were to be recovered by the Respondent-Assessee from the successful bidder as and whe .....

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rried the issue in appeal to the Commissioner of Income Tax (Appeals) [CIT(A)]. By an order dated 10th October, 2013, the CIT(A) upheld the order of the Assessing Officer and dismissed the appeal of Respondent-Assessee. (iii) The Respondent-Assessee filed an appeal to the Tribunal. By the impugned order, the Tribunal held that these expenses were debited in the Profit & Loss Account prepared for the Assessment Year 1997-98 and on recovery of the same from the successful bidder offered it to .....

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substantial question of law. Thus, not entertained. 4 Re: Question (b): (i) Mr. Kotangle, learned Counsel appearing for the Revenue states that the issue raised herein is in respect of deprecation on transactions relating to lease of assets by the Respondentssessee. Our attention is drawn to the impugned order of the Tribunal which allowed the Respondent-Assessee's appeal by following the decision of the Apex Court in ICDS Ltd., v/s. CIT 350 ITR 227. (ii) Mr. Kotangle, learned Counsel appear .....

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with the Fujitsu ICIM Ltd., Konkan Railway Corpn.,Ltd., and Datar Switchgear Ltd. The Assessing Officer as well as by the CIT(A) disallowed deprecation on the assets involved in the sale and lease back agreement claimed by the Respondent-Assessee as being not genuine in respect of the Agreement entered into with Fujitsu ICIM Ltd., Konkan Railway Corpn., Ltd. & Datar Switchgear Ltd., So far as the claim for deprecation in respect of assets leased to Maharashtra Esters & Keytones Pvt. Ltd .....

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port the same. Further, it held that the issue had not been properly examined by the Authorities under the Act. In the above view, it restored the issue to the Assessing Officer to decide the nature of transactions on examination of the sale and lease agreement entered into by the Respondent-Assessee with the three aforementioned lessees i.e. Fujitsu ICIM Ltd., Konkan Railway Corpn. Ltd., and Datar Switchgear Ltd. (iii) We find that the impugned order of the Tribunal restored the issue to the As .....

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appearing for the Revenue has not even attempted to show us as to why the decision of the Delhi High Court in Cosmo Films Ltd., (supra) should not be taken into consideration while determining the nature of the transactions entered into by the Respondent-Assessee with its three lessee on examination of the sale and lease agreements. We find that the decision of Delhi High Court in Cosmo Films (supra) is on an identical fact situation and mere taking of security deposits from the lessee in that .....

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