2019 (10) TMI 509

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..... se of CHALLAPALLI SUGARS LIMITED HINDUSTAN PETROLEUM CORPORATION LTD. VERSUS COMMISSIONER OF INCOME-TAX, AP COMMISSIONER OF INCOME-TAX (CENTRAL) , CALCUTTA [ 1974 (10) TMI 3 - SUPREME COURT] . The Ld A.R has raised a new contention that the other income should not be assessed separately, but it has to be reduced from the pre-construction expenses. However, this claim of the assessee requires examination of facts relating to other income and also the law explained by Hon ble Supreme Court/High Courts in this regard, which is also dependent upon the facts relating to Other income . The assessing officer did not examine this claim of the assessee with regard to other income, even though he has observed that the expenses can be capi .....

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..... e expenses may be capitalised. Accordingly he disallowed the entire expenses claimed by the assessee. Accordingly the AO assessed entire Other income as total income of the assessee. 3. The Ld CIT(A), however, took the view that the assessee has commenced its operations and hence the business expenses claimed by the assessee is allowable as deduction. Accordingly he directed the AO to allow the claim of the assessee. 4. After hearing both the parties, the bench observed that the entire expenses may be required to be capitalised against the fixed assets, as the assessee is in the process of implementing the Rail link project, i.e., it is a case of construction of project, in which case, the entire pre-construc .....

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..... the Ld A.R has raised a new contention that the other income should not be assessed separately, but it has to be reduced from the pre-construction expenses. However, we notice that this claim of the assessee requires examination of facts relating to other income and also the law explained by Hon ble Supreme Court/High Courts in this regard, which is also dependent upon the facts relating to Other income . The assessing officer did not examine this claim of the assessee with regard to other income, even though he has observed that the expenses can be capitalised. Accordingly, we are of the view that this claim of the assessee requires examination at the end of the AO. Accordingly we restore this issue to the file of the AO for examinin .....

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