2014 (12) TMI 525

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....990 declaring total income at Rs. 1,80,72,380/-. Subsequently, a revised return of income was filed on 30.12.1991 declaring total income at Rs. 1,89,22,173/-. The returns were processed u/s.143(1)(a) of the Act and Notices were issued and served upon the assessee. Assessment scrutiny was undertaken and ultimately, the Assessing Officer passed the order of assessment u/s.143(3) of the Act on 30.03.1993. 3. Being aggrieved by the order of the Assessing Officer, appeal was preferred before the CIT(A). The CIT(A) partly allowed the appeal vide order dated 10.10.1994. Against the order of CIT(A), both the assessee as well as Revenue filed appeals before the Appellate Tribunal. After hearing both the sides, the Appellate Tribunal partly allowed ....

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....nature of the building to be a guest house. The intention of the Legislature is clear and unambiguous : the intention was to excluded from deduction the expenses towards rents, repairs and also maintenance of premises / accommodation used for the purpose of a guest house of the nature indicated in subsection (4) of section 37. If the Legislature had intended that deduction would be allowable in respect of all types of buildings / accommodation used for the purpose of the business or profession, then the Legislature would not have felt the need to amend the provisions of section 37 so as to make a definite distinction with regard to buildings used as guest houses as defined in section 37(5) and the provisions of sections 31 and 32 would have....

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....mount of the Share Capital of a company. Capital can be raised by converting debentures into equity shares. Expenditure incurred by the assessee on conversion of convertible debentures into equity shares would have to be treated as capital expenditure. Normally, in a company there are two kinds of share capital; preferential share capital and equity share capital. Generally, all share capital not falling within the description of preference capital is equity capital. Equity share capital is that part of share capital which confers a right either to the whole or part of any residue of any profits or to the whole or part of any residue of any assets remaining for distribution after satisfying the claims of any other shareholders whose right t....

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....cidentally help in the business of the company and in the profitmaking.               9. In view of the above position, decisions cited by the learned counsel for the assessee have no application. Facts of the case clearly indicate that portion of the convertible debenture was converted into equity shares and assessee company had got enduring benefits and therefore, the expenditure incurred by the assessee on conversion of convertible debentures into equity shares has to be treated as capital expenditure. It may be noted that the Assessing Authority disallowed expenditure only to the extent pertaining to the convertible portion of the expenditure which formed part of the capi....