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TMI Blog2019 (10) TMI 388X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that due to procedures in the department the said delay occurred, which may be condoned, as the delay is not intentional and deliberate which is beyond the control. The revenue also filed an affidavit affirming the said reasons. As the revenue was prevented by a reasonable cause, the delay is condoned and the appeal is admitted for adjudication. 3. Brief facts of the case are, assessee company filed its return of income for the AY 2013-14 on 27/09/2013 declaring income of Rs. Nil. Subsequently, the case was selected for scrutiny under CASS and accordingly notice u/s 143(2) on 02/09/2014 issued to the assessee. Also, notices u/s 142(1) and 143(2) along with questionnaire were also issued on 12/01/2016 and 09/02/2016. In response to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny as per the agreement entered into and whatever expenses spent on this overlay works should be treated as capital in nature but not current repairs. If it is current repairs it would be small in nature but not in crores worth unless they lay road and undertook any big work which render the assessee company enduring benefit of business, it is not necessary to spend such a huge amount for administration in addition to the above amount the assessee claimed expenses separately for other departments of company. He, therefore, was of the view that the above amount has to be treated as capital in nature and as per the directions and circular of the Hon'ble Board it also has to be considered for the amortization from this year for the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present at assessment stage. The disallowance by the Assessing Officer is not based on any tangible Of specific evidences. The disallowance made on account of travelling expenses and professional charges by the Assessing Officer does not hold merit. Hence, Ground Nos.2 and 3 in appeal are allowed." 5.1 As regards the disallowance of maintenance expenditure, the CIT(A) deleted the same by observing as under: "IX) ..............Facts of the case, grounds of appeal, assessment order and submissions of the appellant were perused. The appellant company was in the business of construction and maintenance of roads under the BOT scheme with the Madhya Pradesh Road Development Corporation Limited. As per the terms of the concession agreement, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in view the various fact.s, issues and circumstances, Grounds Nos.5 and 6 in appeal are allowed." 6. Aggrieved by the order of CIT(A), the revenue is in appeal before us raising the following grounds of appeal: "1. The Ld. CIT(A) erred both in law and on facts of the case. 2. Whether on the facts and in the circumstances of the case and in law the CIT(A) is correct in allowing the expenditure amounting to Rs. 20,82,628/- as having verified the said bills/ vouchers with respect to such expenditure which might be correct and genuine, the fact remain as to whether such expenditure was met wholly and exclusively for the purpose of business. 3. Whether on the facts and in the circumstances of the case and in law the CIT(A) is correct in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant for the business and incurred for entertainment of visitors and travelling by the company staff. 9.3 With regard to ground No. 3, he brought to our notice the concession agreement entered by the assessee with MP Rajya Setu Nirvana Nigam Ltd. and brought to our notice Clause - 18 i.e. operation and maintenance clause, as per which, assessee has to incur with regard to maintenance expenditure on a periodical basis. He submitted that all these expenditures are explained in detail before the CIT(A) and he supported the order of ld. CIT(A). 10. Considered the rival submissions and perused the material on record. We notice that AO has disallowed the travel expenditure considering it as foreign travel and legal expenditure as AR of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P&L account in the paper book, as per which, assessee has incurred 5.93 crores in previous year and in this AY assessee has incurred Rs. 14.7 crore. In this AY, as per the concession agreement entered by the assessee, with the MP Govt., assessee has to maintain roads on periodical basis and at least it has to carry out relaying of roads as per the agreement on regular basis. Further, assessee has incurred expenditure on maintenance over the years and the department has always accepted the same as revenue expenditure and only in this AY, AO has taken it as capital expenditure considering the quantum of expenditure without any basis. Since the assessee is maintaining roads in order to collect tollway fees, it is the responsibility of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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