2010 (8) TMI 26

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....made in the application, we find sufficient cause for condonation of delay and accordingly, delay of 124 days in re-filing the appeal is condoned. Accordingly, application stands disposed of. ITA 930/2010 1. The present appeal has been filed under Section 260A of Income Tax Act, 1961 (for brevity "Act, 1961") challenging the order dated 12th June, 2009 passed by the Income Tax Appellate Tribunal (in short "ITAT") in ITA No. 2175/Del/2009, for the Assessment Year 2005-2006. 2. Briefly stated the relevant facts of this case are that respondent-assessee is involved in production of Aluminium from Bauxite. The respondent-assessee has set up a power plant in the premises of NTPC for its own captive consumption. Since the expenditure ....

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....October, 2009 in ITA No. 532/2006. The relevant portion of the Division Bench order is reproduced hereinbelow:- "15. Thus, once we hold that expenditure in question was of revenue nature, the moot question would be as to whether it could be allowed over a period of five years. That has been permitted in the aforesaid judgment of the Supreme Court. We are, thus, of the opinion that no doubt till 1991-92, the part of the expenditure was allowed every year. It was loosely called as depreciation. What can be said is that the revenue expenditure was allowed every year at the rates on which depreciation is allowed. Since this was wrong practice adopted, the C&AG rightly advised the assessee to change the accounting method to bring it in tune w....

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....f incurring the expenditure was to employ what was taken in as capital of the business. Again, it is to be seen whether the expenditure incurred was part of the fixed capital of the business or part of its circulating capital." 7. The Supreme Court in Commissioner of Income Tax, BombayCity-I Vs. Associated Cement Companies Ltd. (1988) 172 ITR 257 has held as under:- "……The first contention was that, since, as a result of the expenditure incurred, certain water pipelines were laid which could be regarded as capital assets, the expenditure could only be regarded as capital expenditure. In our view, there is no substance in this contention. It is true that certain water supply lines did come to be laid as a result of the expenditure inc....