TaxTMI 
TaxTMI 
2022 (11) TMI 176
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....AUDHURY, JM : This appeal preferred by the assessee emanates from the order of the ld. CIT(A)-7, Pune dated 20-06-2018 for A.Y. 2015-16 as per the following ground of appeal. "On the facts and in the circumstances of the case, and in law the lower authorities erred in disallowing the indexed cost of expenditure of Rs. 13,18,124/- by not treating them as capital expenditure which is con....
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.... Ltd., on which capital gain has arisen. During the assessment proceedings, the A.O noted that the assessee has declared long term capital gain of Rs. 10,62,89,980/- which is short by Rs. 13,67,890/- from declaration. The assessee explained that the expenditure incurred like auditors' fees, advertisement, bank commission, licence fees, etc. were capitalised and apportioned in ratio of the land are....
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....xpenses are covered and allowable u/s 35D at the time of commencement of production. The expenses which are not allowable u/s 35D has to be capitalised. Nexus must be there in capitalization of pre-operative expenses to the asset. The A.O has rightly observed that none of these expenses have direct nexus in improvement of the land. Even at the appellate stage, the assessee could not demonstrate th....
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....nses have been incurred towards improvement of the land. 5. We are of the considered view that it has been rightly observed by the ld. CIT(A) that whatever expenses the assessee is claiming are pre-operative expenses and they are allowable u/s 35D of the Act. The other expenses which are not allowable u/s 35D needs to be capitalised, but there has to be a direct nexus between such capitalisatio....