TMI Blog2022 (9) TMI 1114X X X X Extracts X X X X X X X X Extracts X X X X ..... otally differentiated as the conditions in regard to FCCB about conversion price, conversion price reset, adjustment to conversion price, redemption of bonds in the event of de-listing and etc. will have very limited bearing while opting for conversion into ordinary equity shares as per the records. The assessee has given details as regards to computation of income for expenses on issue of FCCB, security premium on redemption of FCCB and interest booked under FCCB expenses and initial conversion price of Rs.130/- per share from the issue date and until 14.10.2012 was defined by the assessee. Mere reference on the decision by the CIT(A) cannot be called as not deciding the case on merit. CIT(A) has taken proper cognisance related to vario ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unds be set aside and that of the Assessing Officer be restored. 3. The assessee is engaged in the business of trading of Computer System/ Telecom System/development of Software and GIS. The assessee filed return of income under Section 139(1) of the Income Tax Act, 1961 on 30.09.2018 declaring total income of Rs.5,59,67,400/-. The return of income was processed under Section 143(1) of the Act. The case of the assessee was selected for scrutiny. The notice under Section 143(2) of the Act was issued on 25.08.2009 31.03.2010 which was duly served. Subsequently, notice under Section 142(1) read with Section 129 of the Act was issued on 13.01.2010 calling thereby preliminary information, documents such as copy of audited balance sheet a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Ld .DR s submission before us. 6. The Ld DR submitted that the CIT(A) erred in deleting the addition of Rs.3,30,36,346/- being expenses of Foreign Currency Convertible Bonds (FCCB) which was held as capital expenditure by the Assessing Officer by merely relying on the decisions relied by the assessee and not deciding the issue contested by the assessee on merit. In assessee s case there were various terms offered for raising funds through FCCB convertible into ordinary equity shares. Therefore, the ratio of M/s. Secure Meters Limited cannot be squarely applied to the assessee s case. Ld. DR relied upon the assessment order. 7. We have heard the Ld. DR and perused all the relevant material available on record. From the perusal of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision relied by the Assessing Officer in the case of Ashima Syntex (100 ITD 247) and Banco Products (I) Limited vs. DCIT of ITAT Ahmedabad was delivered prior to 2007 and there are decisions of the Hon ble High Courts which held that the expenses issue of fully convertible debentures are allowable as Revenue expenditure. The CIT(A) has relied upon the decision of Hon ble Rajasthan High Court in case of Secure Meters Limited (supra) wherein it has been held that expenditure incurred for fully convertible debentures are allowable as Revenue expenditure. Thus, the CIT(A) has allowed this ground of the assessee. After perusal of the records, it can be seen that the assessee though issued foreign currency convertible bonds the same are basicall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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