2010 (5) TMI 656

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....irected against the order of the learned Commissioner of Income-tax (Appeals)-II, New Delhi, dated September 10, 2008 for the assessment year 2005-06. The grounds raised by the assessee read as under : "(1)  That the learned Commissioner of Income-tax (Appeals) has erred in law in holding that the interest paid by the appellant amounting to Rs. 44,193 is capital expenditure. (2)  That ....

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....was found that the interest was paid on funds, which were used for purchase of land, which is yet to be developed by the assessee-company. It is also noted by the Assessing Officer that legal and professional charges were also paid towards study in Gurgaon for purchase of land to be developed over a period of time. It was held by the Assessing Officer that the expenditure are capital in nature and....

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....eals) on page 3 of his order that interest on borrowed funds and legal and professional charges are incurred in relation to a project which is yet to be completed and other expenditure are being grouped under work-in-progress. In view of this observation and the finding of the learned Commissioner of Income-tax (Appeals), we are of the considered opinion that these two expenses incurred by the ass....