2022 (1) TMI 296

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....2015 for the assessment year 2010-11, 2011-12 and 2012-13 respectively. The revenue has raised the following substantial questions of law for consideration : a) Whether as per the explanation (i) of Section 37 of the Income Tax Act, 1961, punitive charges paid to the Railways in violation of the provision of Indian Railway Act 1989 are not allowable expenditure and no deduction shall be made in respect of such expenditure. b) Whether on the fact and circumstances of the case, the Learned Income Tax Appellate Tribunal erred in deleting the addition made under section 37 of the Income Tax Act on account of Railway Punitive charges. c) Whether on the fact and circumstances of the case, the Learned Income Tax Appellate Tribunal erred in ....

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.... be allowed under explanation to Section 37(1) of the Act. Furthermore, on facts the Tribunal noted that when the respondent/assessee loads the goods for dispatch through railway wagons actual measurement of weight cannot be done due to absence of weighing bridge at the originating station. Thus, we find that the Tribunal rightly decided the issue in favour of the respondent/assessee. Accordingly, the substantial questions of law (a), (b) and (c) all are answered against the appellant/revenue. So far as substantial questions of law (d) & (e) above are concerned identical issue was decided in assessee's group company's case in ITAT 133 of 2015 dated 21st June, 2018. This decision was followed in another assessee's group company's case in PCI....

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....d that since the assessee was entitled to carry on mining operations and such payment had been made for the removal of the difficulty in the assessee carrying on its business in accordance with its licence, the expenditure had to be regarded as a revenue expenditure and could not be treated as a capital expense. The dictum in Bikaner Gypsums Ltd. is squarely applicable in the present case. This is not a case where the assessee, upon payment of the NPV, obtaind a fresh right to undertake any business. That right of the assessee was covered by the licence previously granted in its favour by the State of Odisha. The NPV payment is a king of a compensation for using forest land for non-forest purpose pursuant to an order of the Supreme Court....