Principal Commissioner Of Income Tax v. Venus Infrastructure And Developers Limited

IN THE HIGH COURT OF GUJARAT AT AHMEDABADR/TAX APPEAL NO. 703 of 2018 ================================================================ PRINCIPAL COMMISSIONER OF INCOME TAXVersus VENUS INFRASTRUCTURE AND DEVELOPERS LIMITED ================================================================ Appearance: MR MANISH R BHATT, SENIOR ADVOCATE assisted by MRS MAUNA M BHATT(174) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE M.R. SHAHandHONOURABLE MR.JUSTICE A.Y. KOGJE Date : 26/06/2018 ORAL ORDER (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1.Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the learned Income Tax Appellate Tribunal, Ahmedabad ‘A’ Bench dated 23.02.2018 in ITA No.1916/Ahd/2015 for Assessment Year 2011-12, the Revenue has preferred the present appeal with the following proposed questions of law:- “2-[A]Whether on the facts and in the circumstances of the case and in law, the Appellate Tribunal was right in law and on facts in not appreciating that for expenses of Rs.40,92,252/- incurred towards GIHED were capital in nature akin to increase in brand value as a whole? C/TAXAP/703/2018 ORDER [B] Whether on the facts and in the circumstances of the case and in law, the Appellate Tribunal was right in law and on facts in not appreciating that u/s 36(1)(iii) interest expenses of Rs.9,99,000/- were not allowable since assessee could not explain the expediency for advancing such funds at lower rate than the rate on which it had taken loan from others?” 2.Heard Shri Manish Bhatt, learned Counsel appearing on behalf of the Revenue and considered and gone through the impugned judgment and order passed by the learned Tribunal. 3.Now, so far as proposed Question No.2-[A] is concerned, at the outset, it is required to be noted that in the case of the very assessee for Assessment Years 2008-09 and 2009-10, similar disallowance for expenses incurred towards GIHED came to be deleted and the said decision has been confirmed by the learned Tribunal and the same has attained finality. 4.In view of the above, no substantial question of law arises so far as proposed Question No.2-[A] is concerned. Hence, present appeal deserves to be dismissed and it is accordingly dismissed so far as proposed Question No.2-[A] is concerned. 5.Now so far as proposed Question No.2-[B] is concerned, it is required to be noted that and as noted by the learned Tribunal, the assessee was already having interest free surplus fund and that advances were made in the ordinary course of business. Considering the fact that the assessee was already having interest free surplus fund (as observed by the learned Tribunal in paras-18 to 21 of the impugned order), it cannot be said that the learned Tribunal has committed any error when the learned Tribunal deleted the disallowances made by the Assessing Officer. 6.We are in complete agreement with the view taken by the learned CIT (Appeals) as well as the learned Tribunal. No substantial question of law arises so far as proposed Question No.2-[B] is concerned. Under the circumstances, present appeal qua proposed Question No.2-[B] also stands dismissed. 7.Under the circumstances, the appeal stands dismissed. (M.R. SHAH, J) SHITOLE (A.Y. KOGJE, J)