Expenditure on Freight Cost Study Disallowed as Capital Expense Under Section 115JB, Appeal Dismissed

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....The ITAT upheld the CIT(A)'s decision disallowing the expenditure incurred on a study for optimizing freight costs, which was initially accounted as a provision for capital work in progress and later written off as other expenditure following project abandonment. The tribunal agreed that such expenditure does not qualify as capital expenditure or an unascertained liability. It was clarified that the assessee added back the amount in the computation of book profit under Section 115JB as a diminution in value of investments, consistent with the statutory explanation, and not as an unascertained liability. Consequently, the Revenue's appeal was dismissed, affirming the disallowance and the treatment of the expenditure in the assessee's financials.....