The Commissioner Of Income Tax-Vi v. M/S Century Textiles & Industries

IN THE HIGH COURT OF JDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.3723 OF 2009 The Commissioner of Income Tax-VI...Appellant.Mumbai Vs. M/s Century Textiles & Industries...Respondent.Ltd., Mumbai. Mr. Vimal Gupta, Advocate for Appellant. Mr. Pankaj R. Topani, Advocate for respondent. CORAM : J.P. DEVADHAR AND SMT. R.P. SONDURBALDOTA, JJ. P.C. DATE : 21st June, 2011. 1. In this appeal, five questions of law raised by the revenue, which reads thus:which reads thus: (1)“Whether on the facts and in the circumstances of thecase, the Hon ble Tribunal was justified in law in treating’the projects expenses amounting to Rs.15,65,964/- as revenue expenditure even though the same were connected to the new projects under completion and therefore capital in nature? (2)Whether on the facts and in the circumstances of the case, the Hon ble Tribunal was justified in law in allowing’legal expenses and professional charges amounting to Rs.1,83,566/- which are forming part of project expenses as revenue expenditure even though the same were of capital nature? (3)Whether on the facts and in the circumstances of the case, the Hon ble Tribunal was justified in law in deleting’the dis-allowance of Rs.1,21,533/- on account of foreign travel expenses of Smt. S.D. Birla inspite of the fact that this expenditure was in no way connected with the business of the asesssee company? (4)Whether on the facts and in the circumstances of the case, the Hon ble Tribunal was justified in law in deleting’the dis-allowance of interest to the extent of Rs.11,35,92,962/- made by the A.O. u/s 36(1)(3) of the I.T. Act in respect of new projects under construction.? (5) Whether on the facts and in the circumstances of the case, the Hon ble Tribunal was justified in law in allowing’financial charges of Rs.1,18,03,359/- as revenue expenditure in respect of new projects which were under construction? ” 2. As regards questions 1 to 4 are concerned, similar questions raised by the revenue in the assessee s own case in Income Tax’Appeal 4218 of 2009 have not been admitted. Hence, the questions nos.1 to 4 cannot be entertained. 3 ITXA : 3723/2009 3. As regards the fifth question is concerned, the Tribunal has recorded a finding that the financial charges were paid by the assessee to the Bank for obtaining loan during the course of business and hence allowable as business expenditure. In our opinion, no fault can be found with the decision of the Tribunal in allowing the aforesaid expenditure as business expenditure. Thus, the fifth question cannot be entertained. Accordingly the appeal is dismissed. recorded a finding that the financial charges were paid by the assessee to the Bank for obtaining loan during the course of business and hence allowable as business expenditure. In our opinion, no fault can be found with the decision of the Tribunal in allowing the aforesaid expenditure as business expenditure. Thus, the fifth question cannot be entertained. Accordingly the appeal is dismissed. ( SMT. R.P. SONDURBALDOTA, J. )(J.P. DEVADHAR, J.)