TMI Blog2017 (11) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purpose of the business. It was held that the provision makes no distinction between money borrowed to acquire a capital asset or a revenue asset - Decided against revenue Disallowing expenditure pertaining to Soda Ash and Lab Front projects as revenue expenditure - Held that:- This issue is covered in favour of the assessee by virtue of judgement of this Court in case of Commissioner of Income Tax vs. Nirma Ltd. [2014 (10) TMI 396 - GUJARAT HIGH COURT] the assessee through its existing administrative mechanism started a new facility for production of soda ash and had also set up facility for production of a material called lab for its captive consumption for the purpose of its existing manufacturing business. It is no doubt that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diture pertaining to Soda Ash and Lab Front projects as revenue expenditure? 2. Regarding the first question in case of this very assessee in Tax Appeal No. 1219 of 2006 decided on 10.10.2017, we had held in favour of the assessee making following observations: 18. Before addressing the issue of the very nature of the transaction, we may clear a few peripheral issues. We have noted at some length the reasonings recorded by the Assessing Officer, CIT(Appeals) and the Tribunal. Since all the three authorities have reached at the same conclusions but by adopting slightly different routes, if we superimpose the orders of the three authorities below eliminating the repetition, the following principal objections of the Revenue emerge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee by virtue of judgement of this Court in case of Commissioner of Income Tax vs. Nirma Ltd. reported in [2015] 255 Taxmann.com 125, in which, it was observed as under: 15. On due consideration of rival submissions, we notice at this stage that this Court, while adjudicating the said issue, had at length discussed the same to hold that the expansion since was of an existing business, the tests applied in case of CIT v. Alembic Glass Industries Limited , 103 ITR 715 (Guj) as also in case of Dy. CIT v. Core Health Care Limited , 298 ITR 194 (SC) would have relevance and the borrowings were whether capital or revenue expenditure would be of no consequence. Profitable it would be to reproduce these observations made in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion relied on by the authorities below of this Court in the case of Alembic Glass Industries Ltd. (supra) laid down tests for ascertaining whether a business was part of existing business or the assessee was starting a new unit. It was held that merely because the unit was coming to a distant point by itself would not mean that it was a new business. If the facts as recorded by the CIT (Appeals) and the Tribunal can be said to have achieved finality, it would emerge that the assessee through its existing administrative mechanism started a new facility for production of soda ash and had also set up facility for production of a material called lab for its captive consumption for the purpose of its existing manufacturing business. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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