9911796707
TMI Blog2023 (7) TMI 1302X X X X Extracts X X X X X X X X Extracts X X X X ..... ence these have been heard together and are being disposed of by this common order. The assessee's appeal ITA No. 237/Kol/2023 is taken as the lead case for the purpose of narration of facts. 2. ITA No. 237/Kol/2023 - The sole issue raised by the assessee in this appeal is relating to disallowance of Rs. 7,73,14 356/- u/s 35AD being capital expenditure incurred for the purpose of specified business. 3. The brief facts of the case are that the assessee company filed its return of income for the assessment year 2014-15 on 29.11.2014 declaring total loss of Rs. 24,43,04,021/-. The case was subsequently selected for scrutiny and assessment order under section 143(3) of the Income Tax Act was passed on 28.12.2016 determining the total loss at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the expenditure was not incurred prior to the commencement of the business and not claimed in the previous year in which the operation was commenced, therefore, the same cannot be allowed u/s 35AD of the Act. 4. At the outset, the ld. Counsel for the assessee has submitted that the issue is squarely covered by the decision of the Coordinate Bench of the Tribunal in the Haryana State Warehousing Corporation vs. ACIT in ITA No. 351/Chd/2019 vide order dated 03.10.2019 (one of us i.e. Judicial Member being part of the Bench in the said case). The relevant part of the order of the Tribunal is reproduced as under: 5. We have considered the submissions of both the parties and perused the material available on the record. In the present c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee u/s 35AD of the Act. The ld. CIT(A) upheld the above finding of the AO. 11. We have heard the rival contentions. To better understand the case, we deem it fit to first reproduce the provisions of Section 35AD of the Act : "Deduction in respect of expenditure on specified business. [35AD. (1) An assessee shall be allowed a deduction in respect of the whole of any expenditure of capital nature incurred, wholly and exclusively, for the purposes of any specified business carried on by him during the previous year in which such expenditure is incurred by him: Provided that the expenditure incurred, wholly and exclusively, for the purposes of any specified business, shall be allowed as deduction during the previous year in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mencement of business and has been duly capitalized in the books of account, the claim will be allowed in the year in which the assessee commences operations of his specified business. There is neither any overlapping nor any contradiction in the aforesaid provision. The assessee is covered in the first part i.e. the assessee has incurred the expenditure on the specified business during the year in which operations of his business of warehousing were already going on. In view of this, we do not find any justification on the part of the lower authorities in denying the deduction to the assessee u/s 35AD of the Act. This ground is, accordingly, allowed in favour of the assessee. 14. In view of this, the legal grounds relating to the reasses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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