TaxTMI 
TaxTMI 
2015 (10) TMI 1378
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....h the assessment years is against allowing the amortisation of project development expenses in the assessment year 2007-08 at Rs. 96,10,000 and in the assessment year 2008-09 Rs. 21,61,33,945 on Pali project and Bata Chowk project within the meaning of section 35D of the Income-tax Act, 1961 (hereinafter referred as the Act). 2. The facts of the case in brief are that the assessee is engaged in the business of execution of infrastructure projects on build, operate and transfer basis (BOT). The Assessing Officer observed that the company incurs all the expenditure and then recovers toll for the specified period under the agreement from the users of that facility. On examination of books of account and computation of income, it was found b....
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.... of the assessee wherein the issue was allowability of debenture expenditure. The assessee, as discussed above, is in the building of road and collection of toll tax. He further relied on in the case of Indore Municipal Corporation v. CIT [2001] 247 ITR 803 (SC), wherein it was held that road would not constitute "building". The learned Assessing Officer made the addition of Rs. 96,10,000 in the assessment year 2007-08 and Rs. 26,38,77,016 in the assessment year 2008-09. 3. Being aggrieved by the order the learned Assessing Officer, the assessee carried the matter to the learned Commissioner of Income-tax (Appeals), who has allowed the appeal by observing as under : &nb....
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....o be allowed proportionately with respect to length of contract but not as per the method followed by the assessee. The assessee should follow this method continuously without any change. The assessee claimed these expenditure in limited years not for the whole year of contract and it has been revised every year for claiming the expenses. There is no scientific method to claim the expenditure. There must be consistency for claiming the expenditure, therefore, he supported the order of the Assessing Officer. 5. At the outset, the learned authorised representative vehemently supported the order of the learned Commissioner of Income-tax (Appeals) and claimed that the assessee consistently following the same method on the basis of accounting....
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....n completed in 2001, the second project is Pali bypass, which was awarded by the PWD, Government of Rajasthan, for which toll period allowed for 161 months from completion of the project, i.e., July 7, 1998. The toll period was up to November 11, 2011 and the third and last project was Bata Chowk awarded by the PWD, Government of Haryana, which was started on December 23, 1998 and the toll period was for 87 months from the date of completion of construction i.e., October 24, 2000. The toll period was up to December, 2007. 6. We have heard the rival contentions of both parties and perused the material available on the record. The expenses claimed by the assessee are not preliminary but were work in progress as per the expenditure incurred....