TaxTMI 
TaxTMI 
TaxTMI 
2015 (8) TMI 1215
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....e case and in law, the Tribunal was right in holding that the assessee was engaged in the business of letting out assets on hire and upholding CIT(A)'s order allowing higher rate of depreciation @ 40%? (B) Whether in the facts and circumstances of the case and in law the Tribunal was right in dismissing Revenue's ground of appeal no.2 holding that the lease equalization credited to P&L Account over and above the lease rental cannot be considered as income and thereby upholding reducing of assessee's total income by lease equalization of Rs. 2,06,21,580/-, credited to P&L Account? (C) Whether in the facts and circumstances of the case and in law, the Tribunal was right in allowing entire expenditure of Rs. 23,42,560/- incurred ....
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....d to be deducted while computing the income subject to tax. (b) In appeal, the CIT(A) after considering the submissions interalia records that the Assessing Officer has misunderstood the claim of the respondent with regard to the lease equalization fund. It records that the lease equalization fund is merely a book adjustment entry. It also reiterate that lease rent received by the respondent-assessee has been credited to the Profit and Loss Account and offered to tax. The further credit of the lease equalization fund in the Profit and Loss Account in accordance with the accounting guidelines prescribed by the Institute of Chartered Accountants of India was only for the purposes of meeting with requirements of accounting standards and refle....
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....s a question which requires consideration. (e) So far as the submission on behalf of the revenue is concerned, nothing has been shown to us to indicate that the finding of fact recorded by the Tribunal about the practice in the earlier assessment years is incorrect. In fact no such ground is taken in appeal. Be that as it may, on merits we find that the Assessing Officer has completely misunderstood the claim of the respondent-assessee in respect of the lease equalization fund. It is not disputed even by the Assessing Officer that the lease rent which has been received by the respondent/assessee has been offered to tax. This lease equalization fund is a mere book entry made to comply with the Guidance Note issued by the Institute of Charte....
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....ld that the stamp duty paid for lease of assets should be spread over the entire life of the lease i.e. 30 years as differed revenue expenditure. (b) In appeal, the CIT(A) held that the view of the Assessing Officer that the stamp duty paid on lease documents should be treated as differed revenue expenditure is not correct. However the CIT(A) also did not accept the respondent-assessee's contention that the expenditure is of the revenue nature. In his view, the stamp duty had been paid on the lease deed was to acquire a capital asset. Therefore the stamp duty paid on the document to acquire the leasehold right of land/asset should be disallowed in its entirety being on capital account. (c) Being aggrieved, the respondent-assessee carr....
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....the decisions of this Court, particularly in Cincita Pvt. Ltd. wherein it has been observed that the period of lease for which the property has been taken, cannot be regarded as a decisive test to determine the nature of the expenditure. In any case, it is not disputed before us that the stamp duty amount has been paid on the lease deed for the purposes of carrying on assessee's business. Once the aforesaid position is accepted then the amount of stamp duty paid for has to be allowed as revenue nature. (f) Before closing, we may point out that Mr. Malhotra, the learned Counsel appearing for revenue emphatically urged that the amount of Rs. 23.42 lacs incurred on stamp duty for acquisition of leasehold land is to be allowed as differed ....