2020 (4) TMI 302

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....referred to as "the Tribunal") in ITA No. 2514/Ahd/2016 by proposing following question, stated to be a substantial question of law: "Whether the Appellate Tribunal has erred in law and on facts in deleting the addition of Rs. 4,10,06,609/- made on account of disallowance of Project Facilities Expenses without appreciating that the expenditure is not allowable for the year under consideration?" 2. The assessment year is 2013-14 and the relevant accounting period is the previous year 2012-13.   2.1 During the course of assessment proceedings, the Assessing Officer, on verification of the ledger account of Project Facilities Expenses, observed that, the assessee had debited an amount of Rs. 4,83,71,954/- under the head, Pr....

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.... 09.06.2016 in Special Civil Application No. 17935 to 17937 of 2015 as well as in the case of Income Tax Officer v. Keval Construction, (2013) 33 Taxman 277 and held that the issue is tax neutral and allowed the appeal by deleting the addition. Revenue carried the matter in appeal before the Tribunal, but did not succeed. 3. Mrs. Mauna Bhatt, learned Senior Standing Counsel for the appellant, reiterated the grounds set out in the memorandum of appeal. 4. A perusal of the order passed by the Commissioner (Appeals) reveals that before the Commissioner (Appeals), the assessee had submitted that it had incurred expenses in financial year 2011-12 and accounted the same as work-in-progress under the head non-current asset, and hence, there ....

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....current asset and therefore, there is no error or omission in respect of accounting of expenses of Rs. 4,10,06,609/-. The Commissioner (Appeals) has placed reliance upon a decision of this court in the case of Sajani Jewels v. DCIT (supra) and held that the issue is tax neutral and that the Assessing Officer has unnecessarily raised the dispute. The Commissioner (Appeals) took a note of the fact that any disallowance of expenditure would increase profit derived from industrial undertaking and as the Assessing Officer has not disputed eligibility of such deduction under section 80IA of the Act, the assessee would be entitled to higher deduction under section 80IA on such enhanced figure. Thus, the entire disallowance made by the Assessing Of....