Commissioner Of Income Tax-I, New Central Revenue Building,Statue Circle, Jaipur (Raj v. M/S Tci Infrastructure Finance Ltd., 2Nd Floor, Meghalaya Tower,Jaipur

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 86 / 2010 Commissioner of Income Tax-I, New Central Revenue Building,Statue Circle, Jaipur (Raj). ----Appellant Versus M/s TCI Infrastructure Finance Ltd., 2nd Floor, Meghalaya Tower,Jaipur ----Respondent Connected With D.B. Income Tax Appeal No. 186 / 2010 Commissioner of Income Tax-I, New Central Revenue Building, Statue Circle, Jaipur (Raj). ----Appellant Versus M/s TCI Infrastructure Finance Ltd., 2nd Floor, Meghalaya Tower, Jaipur. ----Respondent D.B. Income Tax Appeal No. 187 / 2010 Commissioner of Income Tax-I, New Central Revenue Building, Statue Circle, Jaipur (Raj). ----Appellant Versus M/s TCI Infrstructure Finance Ltd., 2nd Floor, Meghalaya Tower, Jaipur. ----Respondent D.B. Income Tax Appeal No. 10 / 2011 Commissioner of Income Tax-I, New Central Revenue Building, Statue Circle, Jaipur. ----Appellant Versus M/s TCI Infrastructure Finance Ltd.,, 2nd Floor, Meghalaya Tower, Church Road, Jaipur. ----Respondent D.B. Income Tax Appeal No. 169 / 2014 Commissioner of Income Tax-I, New Central Revenue Building, Statue Circle, Jaipur (Raj). ----Appellant Versus M/s TCI Infrastructure Finance Ltd.,, 2nd Floor, Meghalaya Tower, Church Road, Jaipur. ----Respondent D.B. Income Tax Appeal No. 170 / 2014 Commissioner of Income Tax-I, New Central Revenue Building, Statue Circle, Jaipur (Raj). ----Appellant Versus M/s TCI Infrastructure Finance Ltd.,, 2nd Floor, Meghalaya Tower, Church Road, Jaipur. ----Respondent D.B. Income Tax Appeal No. 26 / 2017 Principal Commissioner of Income Tax-I,, New Central Revenue Building, Statue Circle, Jaipur (Raj.). ----Appellant Versus M/s TCI Infrastructure Finance Ltd.,, 2nd Floor, Meghalaya Tower, Church Road, Jaipur. ----Respondent _____________________________________________________ For Appellant(s) : Mr. Anuroop Singhi with Mr. Aditya Vijay For Respondent(s) : Mr. Gunjan Pathak & Mr. Sandeep Taneja _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE DR. JUSTICE VIRENDRA KUMAR MATHUR Judgment Per Hon’ble Jhaveri, J. 29/05/2017 1.By way of these appeals, the appellant has challenged thejudgment and order of the Tribunal whereby the Tribunal hasallowed the appeal preferred by the assessee. 2.This Court while admitting the appeal No.86/2010 on19.02.2010 has framed the following substantial question of law: “Whether amortization of expenditure ofRs.1,50,50,107/- under section 25D of theact can be permitted ignoring that the saidexpenditure is not allowable under Section35D of the Act?” 2.1This Court while admitting the appeal No.186/2010 on20.08.2010 has framed the following substantial questions of law: “(i)Whether Tribunal was justified inupholdingtheorderpassedbyCIT(Appeals) without giving their ownfinding on the issue in question except toconcur with view taken by theCIT(Appeals)? (ii)Whether CIT(A)/Tribunal was justifiedin upholding the amount of expenditureclaimed by the assessee in the assessmentyear under consideration without recordinga categorical finding as to how and underwhat provisions of Income Tax Act, it islegally permissible? (iii)Whether the expenditure claimed bythe assessee for its amortization satisfy therequirement of Section 35(1)(2)(D) and ifso, whether it could have been allowed? (iv)If amortization of expenditureclaimed by the assessee did not fall withinany of the categories specified in section35D then whether assessee could beallowed the benefit of amortization of theirexpenditure in the absence of any otherprovisions?” 2.2This Court while admitting the appeal No.187/2010 on 14.03.2011 has framed the following substantial question of law: (iii)Whether the expenditure claimed bythe assessee for its amortization satisfy therequirement of Section 35(1)(2)(D) and ifso, whether it could have been allowed? (iv)If amortization of expenditureclaimed by the assessee did not fall withinany of the categories specified in section35D then whether assessee could beallowed the benefit of amortization of theirexpenditure in the absence of any otherprovisions?” 2.2This Court while admitting the appeal No.187/2010 on 14.03.2011 has framed the following substantial question of law: “Whether on the facts and circumstances ofthe case, the Tribunal was right andjustified in upholding the amortization ofexpenditure of Rs.1,56,70,818/- u/s 35D ofthe Act, ignoring that the said expenditureis not allowable under Section 35D of theAct, which was even observed by theCIT(A) and accepted by the assessee?” 2.3This Court while admitting the appeal No.10/2011 on 14.03.2011 has framed the following substantial question of law: “Whether the Tribunal has acted perverselyand contrary to the provisions of section35D of the Act, by upholding theamortizationofexpenditureofRs.1,52,50,933/- ignoring that the saidexpenditure is not allowable under Section35D of the act, as the same was notpreliminary expenses?” 2.4This Court while admitting the appeal No.169/2014 on 05.07.2016 has framed the following substantial question of law: “Whether amortization of expenditure ofRs.26,38,77,016/- under section 35D of theAct can be permitted ignoring that the saidexpenditure is not allowable under Section35D of the Act?” 2.5This Court while admitting the appeal No.170/2014 on 05.07.2016 has framed the following substantial question of law: “Whether amortization of expenditure ofRs.96,10,1000/- under section 35D of theAct can be permitted ignoring that the saidexpenditure is not allowable under Section35D of the Act?” 2.6This Court while admitting the appeal No.26/2017 on 31.01.2017 has framed the following substantial questions of law: “(i)Whetheronthefactsandcircumstances of the case, the Tribunal wasright and justified in upholding theamortizationofexpenditureofRs.1,21,06,000/-U/s. 35D of the Actignoring that the said expenditure is notallowable under Section 35D of the Act,which was even observed by the CIT(A) andaccepted by the assessee? (ii)Whetheronthefactsandcircumstances of the case, the finding ofthe Tribunal is perverse, contrary to therecord and untenable in the eye of law?” 3.The issues are squarely covered by the Circular No.09/2014, DT.23RD APR., 2014 dated 23/04/2014 of which para No.5 & 6 reads as under: “5.In view of the above, Central Board ofDirect Taxes, in exercise of the powersconferred under Section 119 of the Acthereby clarifies that the cost of constructionon development of Infrastructure facility ofroads/highways under BOT projects may beamortized and claimed as allowablebusiness expenditure under the Act. 6.The amortization allowable may becomputed at the rate which ensures thatthe whole of the cost incurred in creation ofinfrastructure facility of road/highway isamortized evenly over the period ofconcessionaire agreement after excludingthe time taken for creation of such facility.” 4.In that view of the matter, the appeals stand disposed ofwith liberty to revive the appeals in case of difficulty. 5.A copy of this judgment be placed in each file. (VIRENDRA KUMAR MATHUR),J. (K.S. JHAVERI),J. Asheesh Kr. Yadav/54-60