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TMI Blog2023 (4) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... and circumstances of the case, the ld. CIT(A) has erred in not quashing the reopening of the case and the consequential assessment order passed under section 147/143(3), which is bad in law. 2. Under the facts & circumstances of the case the ld. CIT(A) has erred in confirming the addition of Rs. 6,74,000/- made by the Assessing Officer, Ward 1, Sikar by treating said amount as capital expenditure/loss instead of revenue expenditure which was deposited by assessee to department of mines for taking contract of royalty recovery and added the same in total income of the assessee. 3. The assessee craves right to add, alter or amend any of the grounds of appeal." 3. The fact as culled out from the records is that as based on the information ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the reply of the appellant after several opportunities appears to be vague. The primary onus was on the appellant to explain the valid reasons for not making the addition/disallowance of Rs.6,74,000/- as capital expenditure. In the given circumstances, both at the assessment stage despite opportunities provided to furnish satisfactory supporting documents and now at the appellate stage, the appellant chose to remain silent and has failed to discharge the onus of justifying the claim of capital expenditure of Rs.6,74,000/- with any documentary evidence, thus, it is held that the AO reasonably made the disallowance. The same is hereby confirmed. Ground No. 2 of the appeal is dismissed." 5. As the assessee did not find any favour from the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. We thus request your Honour to kindly admit the same and oblige. Power to admit additional evidence Further, it is settled principle of law that your Honour has the power to admit additional evidence filed by the appellant, if the appellant has sufficient cause for not producing the same during assessment proceedings, to advance the cause of justice. Reliance in this regard is placed on the following: * Hon'ble Madhya Pradesh High Court in case of CIT vs. Shiya Dawoodi Bohara Jamat [2008] 170 Taxman 293 held that Whether every appellant in appeal has a right to file additionalevidence in support of its case and if appellate authority feels that additionalevidence is material for deciding controversy involved in that case, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16.11.2019. All these evidences makes it clear that the assessee has paid the royalty collection contract amount to state government which is not in the nature of capital or in the enduring benefit to the assessee. The expenditure thus, is merely a commitment fees which is not receivable in future or not adjustable in future benefit. Therefore, the said amount paid is nothing but a business decision to reduce the loss by paying the commitment fees rather incurring more expenditure in arranging the collection work at the site. Based on these set of argument the ld. AR submitted that the finding of the lower authorities are against the facts placed on record. To support the contentions so raised ld. AR of the assessee submitted following docu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the expenditure incurred by the assessee is capital expenditure. The observation so arrived is without any basis or reasoning by the ld. CIT(A). The term capital expenditures are typically one-time large purchases of fixed assets that will be used for revenue generation over a longer period or expenditure incurred for enduring benefit to the assessee. Whereas Revenue expenditures are typically referred to as ongoing operating expenses, which are short-term expenses that are used in running the daily business operations. Thus, based on these basic difference of expenditure and on careful examination of the challans placed on record we are of the considered view that the expenditure incurred by the assessee are not in nature of any enduring ..... X X X X Extracts X X X X X X X X Extracts X X X X
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