2017 (2) TMI 272

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..... 44,22,82, 61,971/-. The Assessing Officer(AO) completed the assessment u/s.143(3) on 29/12/2009, determining its income at Rs. 4,489.32 crores. The CIT initiated revisionary proceedings u/s. 263 of the Act, vide his notice dated 11/05/2001 and vide his order dated 16/12/2011 passed u/s.263 of the Act, he set aside the original assessment order on three issues. He directed the AO to pass the assessment order afresh. The disputed issues on which the original assessment order was set aside were as follows: i) Allowability of the assessee's contribution to the Compensatory Afforestation Fund (CAF), amounting to Rs. 212.52 crores ii) Allowability of prior period expenses amounting to Rs. 9.54 crores iii) Allowability of processing cha....

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....- on account of processing charges of long term loans and amortised Rs. 4,97,53,451/- in books of accounts. It is also noticed from the notes to cash flow statement that interest of Rs. 3.76 crores was capitalised. During the year purchase on fixed assets was Rs. 2245.85 crores. The assessee company in its computation of income under income tax claimed entire processing charges of Rs. 57,96,77,391/- as deduction while arriving at taxable income. As the company itself in books of account amortised the amount of Rs. 497,53,451/- and capitalised interest amount of Rs. 3.76 crores, it concludes that the processing charges are incurred for long term loans for financing capital assets. Thus claiming deduction of Rs. 57,96,77,391/- as revenue expe....

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.... Ltd.(ITA/5021/ / 2009 dt.06/01/2012), P. Abubakar(ITA/725/bang/2009 dt.22/01/2010); Rungta Sons (P) Ltd. (ITA/933/Kol/2009 dt.05.08.2011); Freegrade & Co. Ltd. (ITA/934/Kol/2009 dt.05.08. 2011); Orissa Mining Corpn Ltd. (ITA/76,266 & 240/Ctk/2010 dt. 12.08.2011); Associated Cement Co. Ltd. (ITA/6289/Mum/2003dt.09.03.2011) and Orissa Forest Development Corporation Ltd. (80ITD300) 3.1. He also relied upon the case of T.N. Godavarman Thirumuilpad of the Hon'ble Apex Court(IA No.566 in WP(C)202/1995 dt.29.10.2002 )along with the matters of Tata Power ITA(ITA/226/Bom/1991,dt.5.9.2001),Tata Hydro(335/Mum/1995)and Tata Chemicals Ltd.(ITA/2658/Mum/2002,dt.26.7.2006)He stated that the Tribunal had allowed the claim made by the assessee in all th....

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.... used for a natural regeneration which the assessee participates indirectly. Therefore, at no point of time could it be said that the assessee had incurred capital expenditure giving the assessee a benefit of enduring nature for the purpose of earning segmented income to render the same to income tax. In other words, the authorities below have not pointed out the income generated against the purported deferred revenue expenditure so proposed by them in their impugned orders. The amount was incurred as a revenue expenditure to be allowed in the year it has been incurred. 4. It is not in dispute that the said payment was made as contribution to compensatory afforestation as per the directions of the Supreme Court. It is not permissible for....