TaxTMI 
TaxTMI 
2023 (7) TMI 275
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....2019 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 05-03-2013. The grounds taken by the assessee read as under: - "1. The order of the Commissioner of Income Tax (Appeals) is contrary to law, facts and in the circumstances of the case. 2. The Commissioner of Income-tax (Appeals) erred in confirming the disallowance of Rs. 9,53,573/- being customs duty paid as prior period expenses. 2.1. The Commissioner of income tax (Appeals) ought to have appreciated that the liability to make the payment of the duty had crystalized during the year under consideration and therefore the same is to be allowed in this year. 2.2. The Appellant submits that being a statutory due, it was allowable in the y....
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....been made in the books in regard to such duty or tax for which payment was made later on. To introduce this double test would be writing words into the Section which neither the Tribunal nor the Court is entitled to do." 3. The Commissioner of Income Tax (Appeals) erred in confirming the disallowance of miscellaneous expenditure amounting to Rs. 4,94,32,000/-. 3.1 The Appellant submits that as it is expenditure in the nature of revenue, and the entire expenditure is laid out and expended wholly and exclusively for the purpose of the-business of the appellant, the entire expenditure is allowable u/s. 37 of the Act, irrespective of the accounting treatment given in the books of accounts as deferred revenue expenditure. 3.2 The Commissio....
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.... finished goods and consequently, asked to pay impugned customs duty for Rs. 9.53 Lacs. The assessee could not perform the obligation of export and accordingly, claimed the sum so paid as prior period items. The Ld. AO disallowed the same on the ground that the expenditure was not related to previous year. The Ld. CIT(A) upheld the disallowance against which the assessee is in further appeal before us. 2.2 From the facts itself, it emerges that the expenditure has been crystallized only during this year. The incentive received in earlier year as been considered as income in earlier years. In this year, the assessee could not perform export obligation and accordingly, held liable to pay the said amount. Therefore, the deduction of the same ....
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.... commercial production actually began was treated as 'deferred revenue expenditure' in the books of account. The same has been written-off over a period of 5 years in the books of account. However, in the computation of income, the assessee has chosen to claim the same in the first year itself. From the computation of income of subsequent years as placed on record, it could be seen that the expenditure in those years has been reversed in the computation of income and the deduction of the same has not been claimed by the assessee. The action of the assessee is in accordance with the decision of Hon'ble Supreme Court in the case of Taparia Tools Ltd. (372 ITR 605) which held that when a particular course of action was permissible in law to th....