TMI Blog2021 (2) TMI 1059X X X X Extracts X X X X X X X X Extracts X X X X ..... whether or not the assessee had furnished the details as contended by him. Therefore, in our opinion the matter requires adjudication afresh by the tribunal so far as first substantial question of law is concerned. Therefore, the first substantial question of law is answered accordingly. Addition of interest - interest free loan to two of its subsidiaries company - HELD THAT:- The assessee again has contended before the Commissioner of Income Tax (Appeals) as is evident from para 3(ii) of the order passed by the tribunal that the assessee's own funds were ₹ 124 Crores whereas, the loan advanced is to the tune of ₹ 64 Crores. However, in this regard also, we find that the tribunal has not recorded the any finding whether or not the interest free loans were given from the borrowed funds or from the assessee's own funds. Therefore, the aforesaid issue also requires adjudication afresh by the tribunal. Accordingly, the second substantial question of law is answered. Addition u/s 43B - deposit of property tax amounts to crystallized liability - difference between the taxes actually paid under Section 43B of the Act and taxes deposited as per the directions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating own design and therefore it is not in the nature of revenue expenses? (iv) Whether the Appellate Authorities were correct in holding that the deposit of property tax amounts to crystallized liability without appreciating the difference between the taxes actually paid under Section 43B of the Act and taxes deposited as per the directions of the Court, when the liability to tax is disputed by the assessee and recorded a perverse finding? . 2. Facts leading to filing of this appeal briefly stated are that the assessee is a company which is engaged in the business of manufacture and sale of machine tools. For the Assessment Year 2008-09, the assessee filed its return of income declaring the income of ₹ 27,56,74,120/-. The return was selected for scrutiny and Assessing Officer, by an order dated 10.12.2010 inter alia disallowed the claims made by the assessee with regard to the write off of expenditure relating to loose tools, disallowance of interest on the loans given to sister concerns, disallowance of expenditure debited under the head 'design charges' and disallowance of expenditure claimed under Section 43B of the Act. The assessee thereupon filed an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rpose of payment of money was to clear an intangible asset and any expenditure incurred for intangible asset is capital in nature. 4. It is also urged that the benefit of deduction under Section 43B of the Act is available to an assessee on actual payment. In this connection, our attention has been invited to paragraph 8 of the order passed by the Assessing Officer as well as paragraph 29 of the order passed by the Tribunal. It is submitted that the Tribunal ought to have appreciated that the liability in the instant case is not crystalised as the assessee itself was disputing the liability. It is further submitted that the amount of ₹ 37,50,000/- which was deposited by the assessee, was subject to decisions of this Court and an amount would crystalise when the litigation ends and the payment is made. In support of aforesaid submission, reliance has been placed on the decisions of the 'BHARATH BEEDI WORKS (P) LTD. Vs. ADDITIONAL COMMISSIONER OF INCOME-TAX, RANGE-2, MANGALORE' (2016) 74 TAXMANN.COM 95 (KAR), 'CHALLAPALLI SUGARS LTD. Vs. COMMISSIONER OF INCOME-TAX' (1975) 98 ITR 167 (SC), 'TUTICORIN ALKALI CHEMICALS FERTILIZERS LTD. Vs. COMMISSIONER O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stion of discharging the onus does not arise. It is further submitted that the nature of expenditure has to be determined in order to decide whether the same is revenue or capital in nature. In this connection, our attention has been invited to paragraph 22.1 of the memorandum of appeal which was filed before the Commissioner of Income Tax (Appeals) in which it is pointed out that a sum of ₹ 1,31,05,337/- was paid by the assessee on account of salaries due to the employees and only a sum of ₹ 40,00,000/- was paid to a Singapore Company which was its subsidiary concern. 6. While referring to the third substantial question of law, it is pointed out that the revenue has only questioned the claim of the assessee in respect of an amount of ₹ 1,31,05,337/- and not on account of procuring the design for an extent of ₹ 61,00,000/- while making a reference to paragraph 19a and 22 of the order passed by the Tribunal. It is contended that the matter has been remitted to the Assessing Officer to verify the claim of the assessee and thereafter, to decide the entitlement of the assessee to claim deduction. It is also urged that the judgments with regard to third sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s failed to produce the complete details of the materials received including inventory of materials, date, time and delivery of the loose tools. The assessee company has also failed to produce the material receipt register. Though it has been contended by the assessee before the tribunal as recorded in para11 of the order passed by the tribunal that assessee had produced the C.D. containing the details as requested by the Assessing Officer at the time of hearing. However, the tribunal has not recorded any finding with regard to aforesaid contention of the assessee and in para 14 has recorded the finding in favour of the assessee. In view of the reasoning assigned by the Assessing Officer in his order for disallowing the claim and in view of the assertion made by the assessee that it had furnished the details, the tribunal ought to have ascertained whether or not the assessee had furnished the details as contended by him. Therefore, in our opinion the matter requires adjudication afresh by the tribunal so far as first substantial question of law is concerned. Therefore, the first substantial question of law is answered accordingly. 7. So far as second substantial question of law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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