TaxTMI 
TaxTMI 
TaxTMI 
2010 (12) TMI 1080
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....lines without approval. Such payments were to the extent of Rs. 66,73,323. The depreciation claimed at 10 per cent on this amount was added by the AO as an excessive claim. This addition is common in all the years. 4. The contention of the assessee is that the payment of these amounts to NDMC was part of the total consideration amount payable by that company to Government of India for taking over of Hotel Kanishka. These payments were made for regularizing procedural lapses committed by ITDC 20 years ago and should be treated as a part of purchase consideration and not payment by way of penalty for contraventions of the statutes or infringement of civic regulations. 5. The learned CIT(A) was of the view that these payments were part of the bid amount submitted by the company at the time of disinvestments of Hotel Kanishka owned by ITDC and these amounts were paid for regularization of procedural lapses and only after payment of these amounts completion certificate of hotel was issued by NDMC. The ex facto sanction obtained by the assessee showed that there was no breach of a provision against public policy and the acceptance of compensation could not be for any illegal act agains....
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....onsideration paid and the payments were made to perfect the title of the buyer in the property which it had acquired from the Government of India under the disinvestment policy. The assessee has paid certain amounts which were accepted as part of purchase consideration. The payment of purchase consideration was made to different people having regard to the liabilities of the erstwhile ITDC which was the owner. In fact it could not have had a perfect title to the property which it had purchased, had it not got these things regularized from NDMC by payment of the sums in question. The payments made for perfecting the title or ownership of the business asset represent the expenditure for the purpose of the business and the assessee has rightly capitalized the sums in question which also represent as a part of purchase consideration of the asset. In the light of the principle laid down by the jurisdictional High Court, we decline to interfere. 9. The next common dispute in these appeals relates to the claim of excessive depreciation claimed in respect of UPS and printers. The assessee purchased the UPS and printers and claimed these items to be a part of computer and claimed higher ra....
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....aving elaborately discussed different case law on the point, followed the decision of the jurisdictional High Court of Delhi in the case of Indian Oil Panipat Power Consortium Ltd. v. ITO [2009] 20 DTR (Del) 107 wherein their Lordships of Delhi High Court distinguished the ratio laid down in Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT [1997] 141 CTR (SC) 387 : [1997] 227 ITR 172 (SC) and CIT v. Autokast Ltd. [2001] 165 CTR (SC) 16 : [2001] 248 ITR 110 (SC). According to him the earning of interest and deposits which are kept as margin money which were required for the purpose of issuance of bank guarantee and letter of credit for import of raw material are inextricably linked with the renovation of the hotel and such interest income earned should go to reduce the cost of construction. 13. The Revenue is aggrieved and the learned Departmental Representative vehemently supported the findings of the AO in the light of the Supreme Court decision in the case of Tuticorin Alkali Chemicals & Fertilizers Ltd. (supra). 14. The learned counsel for the assessee, on the other hand, strongly relied upon the discussions in the order of the CIT(A) and has relied upon the decision of th....
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....sequence of that order in the asst. yr. 2007-08 which is the second year in respect of the claim. 20. We have carefully considered the rival contentions and gone through the record including the discussions in the impugned order. The term 'building' has not been defined in the Act. The nature of the asset has to be ascertained and we have to understand the meaning of the term 'building' depending upon the context to which a reference has been made. Here the assessee is in a hotel business. His building is not merely a structure of four walls but includes all such things as are necessary to give the building a better look and is a matter of attraction for the customers to use it. Having regard to the assessee's nature of business it cannot be said that the landscaping done by the assessee cannot be considered as a building. After all the assessee has given a better look to this building by provision of this landscaping which has become an integral part of the building to be used as a hotel. In order to acquire a star category, all these artistic looks are very much necessary. The CIT(A), in our view, has correctly applied the principle laid down by the jurisdictional High Court in ....