9911796707
TMI Blog2024 (9) TMI 367X X X X Extracts X X X X X X X X Extracts X X X X ..... order passed under section 143(3) of the Income Tax Act, 1961 (in short 'Act') dated 31.12.2016 for the A.Y. 2014-15. 2. The Tribunal while adjudicating the case inadvertently erred in not adjudicating Ground No. 5 raised by the assessee in the original grounds of appeal. Thereafter the assessee filed a Miscellaneous Application seeking recall of the order since Ground No. 5 of the original grounds of appeal relating to disallowance of amount paid to M/s. RITES for the purpose of feasibility report of Rs. 5,56,18,200/- was not adjudicated. This Tribunal vide its order dated 24.06.2024 recalled the order dated 25.03.2024 for the limited purpose of adjudicating Ground No. 5 of the original grounds of appeal which reads as follows: - "5. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure. Ld. DR further submitted that assessee was planning to setting up of a new Port and therefore it constitutes setting up of a new project and hence it has to be treated as a capital expenditure. Ld. DR placed reliance on the decision of the Hon'ble Delhi High Court in the case of ICS Systems (P.) Ltd., v. CIT [(2019) 102 taxmann.com 131 (Delhi)]. 5. Countering the argument of the Ld. DR, Ld.AR submitted that the reliance placed by the Ld. DR in the case of the ICS Systems (P.) Ltd., v. CIT (supra) is distinguishable on the fact that in that case advance for acquisition of a capital asset has been forfeited and hence it would amount to capital loss. However, in the instant case, assessee has incurred expenditure for conducting th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 56,18,200/- was for creation of another new major Port where the assessee is also in the same line of business. In this connection, the Hon'ble Madras High Court in the case of Tamilnadu Magnesite Ltd., v. ACIT [(2018) 95 taxmann.com 239 (Madras)] in Paragraph Nos. 25 and 26 held as follows: - "25. As could be seen from the order passed by the CIT(A), the assessee had entered into an arrangement with TIDCO as well as with IDBI and fixed the project cost with a debt equity ratio, which was approved by the Government of Tamil Nadu and thereafter, steps were taken to acquire land, import machinery etc. In the meantime, 12 years had passed by and the project had not taken off. The IDBI had withdrawn from the project, as it was found to be unv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during benefit, which should accrue to the assessee and there should be a creation of a new asset. In the instant case, both these parameters remain unfulfilled. 7. Further in Paragraph Nos. 27 & 28, the Hon'ble Madras High Court in the case of Tamilnadu Magnesite Ltd., v. ACIT (supra) held as follows:- "27. The High Court of Delhi in Indo Rama Synthetics Ltd. (supra) held that if the expenditure is incurred for starting a new business, which was not carried out by the assessee earlier, then such expenditure was held to be capital in nature. However, if the expenditure incurred is in respect of the same business, which is already carried on by the assessee, even if it is for the expansion of the business, viz., to start a new unit, which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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