TMI Blog2019 (2) TMI 271X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the bank meaning thereby the same has been advanced out of own funds by the assessee. So, in the given facts and circumstances, we find no ground to interfere with the findings returned by the ld. CIT (A) deleting the addition. Upfront charges paid for obtaining term loan from bank - whether is covered within the definition of interest given in section 2(28A) and hence allowable as revenue expenditure? - Held that:- When we examine provisions contained u/s 36(1)(iii) in the light of the definition of “interest” in section 2(28)(a) of the Act, it certainly includes any service fee or other charges in respect of money borrowed or debt incurred. Even otherwise, when AO has allowed the interest on the loan in question as Revenue expendit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deleted the addition - Decided against the Revenue. - ITA No.1118/Del./2015 - - - Dated:- 30-11-2018 - Shri N.K. Billaiya, Accountant Member And Shri Kuldip Singh, Judicial Member For the Assessee : None For the Revenue : Shri Naina Soin Kapil, Senior DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : The appellant, DCIT, Circle 13 (2), New Delhi (hereinafter referred to as the Revenue ) by filing the present appeal, sought to set aside the impugned order dated 09.12.2014 passed by Ld. CIT (Appeals)-VIII, New Delhi qua the Assessment Year 2010-11 on the following grounds inter alia that:- 1. On the facts and circumstances of the case in law, the Ld. CIT (A) has erred in deleting the addition of ₹ 1,32,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has erred in deleting the addition of ₹ 47,94,600/- made by the AO by way of disallowances out of total expenditure of ₹ 59,93,250/- incurred towards purchase of data package inter-alia giving a finding that the AO himself treated such expenditure as differed revenue expenditure, thus giving a finding which is contrary to the finding of the AO in this regard who explicitly treated whole of such expenditure of ₹ 59,93,250/- as capital in nature and disallowed 4/5 of such expenditure (i.e. ₹ 47,94,600/-) in the assessment year under consideration. 6. That the order of the Ld. CIT (A) is erroneous and is not tenable on facts and in law. 7. That the grounds of appeal are without prejudice to each other. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the Tribunal by way of filing the present appeal. 4. Assessee has not preferred to put in appearance despite issuance of the notice and consequently, we proceeded to decide the present appeal with the assistance of the ld. Senior DR as well as on the basis of documents available on the file. 5. We have heard the ld. Senior Departmental Representative for the revenue to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 6. The ld. DR for the Revenue challenging the impugned order contended that since the assessee has been following mercantile system of accounting, the ld. CIT (A) erred in deleting the additions and relied u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s advanced prior to the loan availed off from the bank meaning thereby the same has been advanced out of own funds by the assessee. So, in the given facts and circumstances, we find no ground to interfere with the findings returned by the ld. CIT (A) deleting the addition of ₹ 1,32,00,000/-. Hence, Grounds No.1 2 are determined against the Revenue. GROUNDS NO.3 4 9. Undisputedly, the upfront and syndication of charges of ₹ 2,09,02,500/- was made by the assessee company for availing of the term loan of ₹ 200 crores from State Bank of India and Central Bank of India respectively which was claimed as revenue deduction. It is also not in dispute that upfront fee is paid only once during the tenure of the term loa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of purchase of data packages on the ground that the same amounts to deferred revenue expenditure. Undisputedly, the assessee company has made payment of ₹ 59,93,250/- to Director General of Hydro Carbon (DGH) for purchasing data packages which was mandatory for the assessee company to participate in the bid. The Revenue has not disputed the incurrence of that expenses for business purposes but allowed the same as deferred expenditure over a period of five years. We are of the considered view that when the assessee was made to incur the mandatory expenses having been paid to DGH for participating in tender/bid process, no enduring benefit, as has been observed by AO, can be made out. Moreover, AO has not disputed the nature of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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