TMI Blog2016 (12) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the Assessing Officer for the assessment year 2004-05 has in the assessmnet order stated that amount is allowed on payment basis and accordingly in the year under consideration where the liability is crystallized by the order of Supreme Court, the deduction claimed on protective basis shall not be granted. Considering the decisions cited hereinabove, we are of the view that issue raised in both these appeals is required to be answered in favour of the assessee and against the revenue. Rejection of claim to allow deduction u/s 43B - payments made beyond the due dates under the relevant Acts - Held that:- The said issue is now squarely covered by the decision in the case of Commissioner of Income-tax vs. Alom Extrusions Ltd [2009 (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pump etc and that the same falls in the category of consumable stores and spares. We are of the view that the same should be considered under the head of revenue expenditure and the Tribunal is justified in considering the same as revenue expenditure and accordingly the said question is answered in favour of assessee and against the revenue. - TAX APPEAL NO. 1095 of 2006 With TAX APPEAL NO. 1096 of 2006 With TAX APPEAL NO. 1097 of 2006 With TAX APPEAL NO. 1098 of 2006 With TAX APPEAL NO. 786 of 2007 With TAX APPEAL NO. 1433 of 2008 - - - Dated:- 28-6-2016 - MR.JUSTICE KS JHAVERI AND MR.JUSTICE G.R.UDHWANI MR KM PARIKH, ADVOCATE FOR THE APPELLANT MR B S SOPARKAR, ADVOCATE FOR THE RESPONDENT ORAL JUDGMENT (PER : H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NO. 1097 OF 2006 [A] Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in allowing deduction of payment to the ONGC, when the whole contractual liability was in dispute before the Hon'ble Supreme Court ? [B] Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in allowing deduction u/s 43B in respect of the payments made beyond the due dates under the relevant Acts, without giving any finding as to the cut off date of allowability ? [C] Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in allowing depreciation on all the items of air pollution control equipments and energy saving devices, despite the qualifyin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case, the Tribunal was right in law in holding that the expenditure on centrifugal pumps, humidity indicators, temperature controllers, vacuum pumps, 3-phase industrial motors and submersible pump etc. constituted revenue expenses, when these items were not used as replacement of worn out parts of existing machinery but each constituted additional item of machinery ?? [D] Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in setting aside the disallowance of exchange fluctuation loss with the observations, inter alia, that, if it was held to be capital loss, it should be set off against the profit from the sale of unistalled equipments purportedly taxed in the assessement year 1997- 98, which wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as this Court in the case of Indian Molasses Company Ltd reported in 37 ITR 66 (SC), Associated Electrical Industries (India) Private Limited reported in 157 ITR 72 (SC) and in the case of Commissioner of Income Tax II vs. Bhagwati Corporation reported in 217 Taxman 144 (Guj) and submitted that expenditure primarily denotes the idea of spending or paying out or away and it is something which has gone irretrievably. He submitted that the assesee has no control on the amounts that have been given and the payments made towards liability existing at that point of time. 2.2 We are of the view that taking into consideration the issue which was pending before the Apex Court regarding the liability to be fixed but ONGC has already cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Section 43B by Finance Act 2003 is retrospective and it would operate with effect from 01.04.1988. In the present case the assesee has paid the said amount beyond due dates but before due date for filing return of income. The Tribunal has relied upon various case laws wherein it is held that second proviso to Section 43B is to be applied retrospectively as the said proviso was inserted to remove hardship caused to assessee. We accordingly answer the question in favour of assessee and against the revenue. 3.1 So far as question regarding non allowance of depreciation @100% in respect of air pollution control equipments is concerned, the Tribunal has allowed the claim by citing the reason that the work being used as item no. III(2)(i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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