AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (7) TMI 1956
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....plant and machinery. The assessee had claimed sum of Rs.29.25 crore under the head 'repairs and maintenance'. The AO noticed that the above said expenditure included repairs and maintenance of office building and hotel amounting to Rs.357.62 lakhs. The AO noticed that the assessee had commenced operations relating to operating and maintaining Airport of Hyderabad with effect from 23/3/2008 only. Accordingly, he took the view that the expenditure incurred on Office building and Hotel is capital in nature, since the same would not qualify as current repairs within the meaning of sec. 30/31 of the Income-tax Act. Accordingly he disallowed Rs.357.62 lakhs referred above. The ld CIT(A) took the view that the assessee is required to maintain the properties and accordingly held that 70% of the amount may be considered as capital in nature and remaining amount may be considered as revenue in nature. Accordingly he confirmed the disallowance to the extent of Rs.2.50 crores. 4. We heard the parties and perused the record. The assessee placed reliance on various case laws to submit that the expenditure incurred on repairs and maintenance of building & plant and machinery is revenue in natu....
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....), however, dismissed the said claim of the assessee by holding that the assessee could make additional claim only by filing revised return of income as held by Hon'ble Supreme Court in the case of Goetze (India Ltd.) Vs. CIT (2006)(284 ITR 323). 9. We have heard the parties on this issue and perused the record. We noticed that the claim of the assessee has not been examined by the AO, since the said claim was made for the first time before the ld CIT(A) by the assessee. Though the decision rendered by Hon'ble Supreme Court in the case of Goetze India Ltd., (Supra) stated that the additional claim can be made by filing a revised return only, yet the Hon'ble Supreme Court has made it clear that the same will not impinge upon the power of the Tribunal to admit additional claims. Accordingly, we admit the claim of the assessee. Before us, the ld AR furnished a copy of Order passed by Mumbai Bench of Tribunal in the case of Addl. CIT(A) Vs. Mumbai International Airport Ltd., in ITA No.3232/Mumb/2012, wherein it was held that the surplus arising in passenger service fee is not liable to taxed. The ld AR submitted that, by applying the same analogy, the assessee may not be entitled fo....
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....enditure for development of villages around the airport. The details of expenditure are furnished at pages 448 and 449 of the paper book. The ld AR further submitted that the assessee had engaged the charitable organization named GMR Varalaskhmi Foundation to carry out the activities through it. Hence the payment made to the above said charitable organization is in the nature of reimbursement and the same cannot be considered as donation paid by the assessee to the above said organization. The ld AR submitted that the CIT(A) has placed reliance on the amendment brought out by Finance Act (No.2 Act 1998) w.e.f 1/4/2015 by inserting explanation 2 to sec. 37, wherein it has been provided that the expenditure incurred by the assessee on the activities relating to corporate social responsibility shall not be deemed to be expenditure incurred by the assessee for the purpose of business. He submitted that the above said amendment shall be applicable from asst. year 2015-16 only. He submitted that the jurisdictional high court has held in the case of CIT Vs. Infosys Technologies Ltd., (2014) 43 taxmann.com 251 has held that the expenditure incurred by assessee on installation of traffic si....
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....onnection between the expenditure and the business use, i.e., those assessees were able to demonstrate the connection between the expenditure incurred and its use for the business of the assessee. In the instant case, though the assessee has furnished details of expenditure, it has not demonstrated the connection between the expenditure and the business advantage to the assessee. Further, as stated earlier, the nature of payment as well as the nature of expenditure incurred by GMR Varalaskhmi Foundation require examination. Under these set of facts, we are of the view that, in the interest of natural justice, the assessee may be provided with one more opportunity to explain its case before the AO. Accordingly, we set aside the order passed by the ld CIT(A) on this issue and restore the same to the file of the AO for examining this issue afresh in the light of the decision rendered by Hon'ble Karnataka High Court referred (Supra). 15. The last issue relates to disallowance of payment made towards delayed deposit of service tax and VAT by treating the same as penalty in nature. 16. The assessee claimed a sum of Rs.8.63 lakhs as penalty but did not disallow the same. The AO exam....