TaxTMI 
TaxTMI 
2020 (2) TMI 205
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....r (BOOST) basis in terms of the concession agreement. Accordingly, BIPL has incorporated Dighi Port Ltd. (DPL) as the Special Purpose Vehicle (SPV) to develop and implement the project and the concession agreement has been novated in favour of DPL. In terms of the concession agreement, the assessee had started constructing the Dighi Port Project and for this purpose it has entered into a sub-concession agreement with IL&FS Maritime Infrastructure Co. Ltd. (IMICL), a subsidiary of Infrastructure Leasing and Financial Services Ltd. (IL&FS) for undertaking the development and implementation of Berth which entrusts IMICL with rights to use infrastructure facilities for a period of 30 years and as per the terms of the agreement IMICL has to share 40% of the gross revenue generated from the said Berth after it becomes operational. For the assessment year under dispute, the assessee filed its return of income on 30th September 2013, declaring loss of Rs. 44,41,81,900. The assessment in case of the assessee was completed under section 143(3) of the Income Tax Act, 1961 (for short "the Act") vide order dated 20th March 2016, determining the loss at Rs. 33,14,53,278, and long term capital ga....
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....ssessee. 3. The learned Authorised Representative submitted, in the course of assessment proceedings, the Assessing Officer has specifically enquired into the nature of lease premium received from IMICL and after making proper enquiry and application of mind, he has accepted assessee's explanation that the amount received being in the nature of capital receipt is not taxable. In support of such contention, he drew our attention to the letter dated 15th March 2016, claimed to have been filed before the Assessing Officer in the course of assessment proceedings, a copy of which is at Page-5 of the paper book. The learned Authorised Representative submitted, since after due enquiry and application of mind, the Assessing Officer accepted the nature of receipt as capital, the assessment order passed cannot be treated as erroneous and prejudicial to the interests of Revenue merely because learned PCIT is of the opinion that the receipt is of revenue nature. Further, learned Authorised Representative submitted, the amount received by the assessee is in the nature of advance, hence, cannot be treated as income. To support such contention, learned Authorised Representative drew our att....
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....assed under section 143(3) of the Act, we find that the assessment order has been passed in a routine manner with some general observations. There is absolutely no discussion/observations on the nature and character of the lease premium receipt and its taxability at the hands of the assessee. As observed by learned PCIT, the assessee had directly credited the amount of Rs. 93.02 crore representing the lease premium to capital reserve account in the Balance Sheet without routing it through the Profit & Loss Account. This fact itself should have triggered an enquiry by the Assessing Officer. As it appears from record, apparently, the Assessing Officer has not conducted any such enquiry. Though, the learned Authorised Representative has submitted that the Assessing Officer has made enquiry on the issue and referred to the compliance dated 15th March 2016, supposed to have been filed before him, however, on a specific query from the Bench to furnish the notice/letter issued by the Assessing Officer to reveal the nature of enquiry conducted by him, learned Authorised Representative expressed his inability to furnish any such document. In fact, the compliance dated 15th March 2016, is al....
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....e nature and character of lease premium received by the assessee and directing the Assessing Officer to make the addition. Therefore, the aforesaid direction of learned PCIT needs to be modified. In fact, in course of hearing, both, the learned Authorised Representative and the learned Departmental Representative have submitted that the nature and character of the receipt has to be examined by the Assessing Officer without any fetters being put by the higher authorities. In view of the aforesaid, while partly modifying the order of learned PCIT, we direct the Assessing Officer to examine the nature and character of the lease premium received of Rs. 93.02 crore and its taxability at the hands of the assessee in the impugned assessment year. While deciding the issue, the Assessing Officer must allow full opportunity to the assessee to furnish all the evidences and relevant materials as well as to make submissions with regard to the nature and character of the receipt. The Assessing Officer must examine all such evidences and submissions of the assessee in the light of the decisions to be relied upon and decide the issue in accordance with law without being influenced of any of the....