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TMI Blog2019 (2) TMI 2128X X X X Extracts X X X X X X X X Extracts X X X X ..... ture incurred during construction period. 1.1 On facts of the case and in law the Ld. CIT (A) erred in not allowing the set-off of interest expense of Rs. 9,46,00,000/- debited to the capital work in progress against the said interest receipt without appreciating the fact that there is a direct nexus of interest paid on the borrowed funds with the interest receipts. 2. On facts of the case and in law The Ld. CIT (A) erred in confirming the action of AO in disallowing mandatory CSR expenses of Rs. 2,00,00,000/- provided as per terms of environment clearance granted by the Ministry of Environment & Forests (MOEF) which were incurred wholly and exclusively for the purpose of the business. 3. On the facts of the case the Ld. CIT (A) erred in remanding back the issue to the file of the Ld. Assessing Officer on allowance of the amortization of surface rights claimed by the Appellant, without appreciating the fact that all the details as required for verification for allowance of the same, as directed by the Hon'ble ITAT Jaipur for AY 2012-13 in case of the Appellant, were available with the Ld. CIT(A). 4. On the facts of the case the Ld. CIT (A) erred in remanding b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,00,00,000/- 5. Interest on refund Rs. 37,672/- 6. Disallowance of amortization Rs. 14,38,96,693/- 6. By the impugned order, the ld. CIT (A) has upheld the addition with respect to the interest receipts being taxable as income from other sources credited to the capital work in progress, disallowance of mandatory CSR expenses of Rs. 2.00 crores. However, the ld. CIT (A) has deleted the addition with respect to mine closure expenses of Rs. 5,56,27,993/-. 7. Against the above said order, both the assessee and the revenue are in further appeals before us. 8. At the outset, the ld. AR of the assessee placed on record the order of the ITAT in assessee's own case and further the order of the Hon'ble Rajasthan High Court in assessee's own case for the A.Y. 2012-13 in DBITA No. 54/2018 and M.A. order dated 08/08/2018 in D.B. Civil Misc. application No. 176/2018. 9. With regard to ground taken by the assessee for treating the interest income as income from other sources, we found that the Assessing Officer had added Rs. 7,34,00,000/- on account of interest credited to the Capital Work in Process (CWIP) in the taxable income under the head income from other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;176/2018, the Hon'ble High Court has held as under: "By way of this application, the applicant has prayed the following relief(s):- "The present rectification application may pleased be allowed and the judgment dated 24.07.2018 be appropriately rectified/modified in view of the submissions made above. In view of the averments made in the application, the order dated 24.07.2018 is modified in the following terms which may be read as para 7 of the judgment:- "Taking into consideration the decision of Supreme Court in the case of Bokaro Steel Ltd. (supra) and other judgments cited supra, both the issues are answered in favour of the assessee and against the department." The misc. application is allowed." 14. Exactly similar issue has been raised by the assessee with regard to the treatment of interest income, which has been held to be income from other sources by the departmental authorities. As on the similar facts the issue has already been decided by the Hon'ble Rajasthan High Court in assessee's favour as stated above, respectfully following the same, we do not find any merit in the action of the lower authorities for treating the interest income as income fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugh RSMML but it is not clear whether the RSMML has also claimed such expenditure. Therefore, the AO was directed to verify whether RSMML has made any claim on the same expenditure which the assessee has claimed. Respectfully following the order of the Tribunal, we restore the issue back to the Assessing Officer for verifying the same in terms of the direction of the Tribunal in assessee's own case. We direct accordingly. 18. The department in its appeal is aggrieved by the decision of the ld. CIT (A) allowing the deduction in respect of mines closure expenses. 19. We had carefully gone through the orders of the authorities below and found that the ld. CIT (A) has allowed the deduction in respect of mines closure plan after following the decision of the Tribunal in assessee's own case for the A.Y. 2012-13 dated 12/10/2017. 20. We had gone through the order of the Tribunal in assessee's own case and found that this issue was dealt by the Tribunal as under: "15. Ground no. 2, is against allowing deduction of Rs. 4,70,80,000/- in respect of mine closure expenses. 15.1 Ld. D/R supported the order of the authorities below and submitted that Ld. CIT (A) was not justified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p;144/JP/2014 and 124/JP/2014 dated 12.02.2016 and the relevant portion of the order is as follows: "30.3 We have heard rival contentions and perused the material on record. In our view, once assessee whether private or government take on lease a mine, its closures is inevitable. A mine cannot be permitted to be exploited infinitely and indefinitely. In our view, one the mine is exploited, its closure and rehabilitation is necessary. In our view, the Ministry of Coal, Government of India had provided structured programmed/ guidelines for closure of mines. In our opinion, the view expressed by the AO and Ld. CIT (A) is contrary to law and we disagree with the view of the authorities below that the liability is a contingent liability and is not ascertainable liability. The guidelines laid down by the Coal Ministry, has elaborately given the charge to quantify the liability and the manner in which the amount is required to be spent for closure of the mines and for restoring the ecological balance and environment protection. Therefore, to say that the liability is merely a contingent and has to be arises, in our view is preposterous and without any merit. The provisions are required ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. In view of the above, the ground of the assessee is allowed and the Assessing Officer is directed to give the benefit of deduction of Rs. 2,94,04,000/- towards mines closures expenses in the A.Y. 2010-11. In view of the discussion as above, and the finding of the jurisdictional ITAT, on this issue, the addition made under this head is deleted. This ground of appeal is allowed." 15.4 Ld. CIT (A) has followed the decision of the Co-ordinate Bench rendered in the case of M/s Rajasthan Mines and Mineral Ltd. vs. ACIT in ITA No. 144/JP/2014 & 214/JP/2014 dt. 12.02.2016. 15.5 The Revenue has not placed any contrary binding precedents. Therefore, we do not see any reason to interfere into the finding of the Ld. CIT(A), same is hereby affirmed. This Ground of Revenue's appeal is dismissed." 21. As the facts and circumstances during the year under consideration are same, respectfully following the order of the Tribunal in assessee's own case, we do not find any reason to interfere in the order of the ld. CIT (A) deleting the disallowance in respect of mines closure plan. We direct accordingly. 22. As the facts and issues of the assessee for the A.Y. 2014-15 ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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