ACIT, CHENNAI V. M/s. Kasturi & Sons Ltd., CHENNAI

ITA 1612/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58030 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-03-2012
• Assessment Year: 2000-2001
• Appeal Filed On: 04-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revenue expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA NO.1612(MDS)/2011 ASSESSMENT YEAR : 2000-01 THE ASSISTANT COMMISSIONER OF INCOME-TAX, COMPANY CIRCLE II(4), CHENNAI. VS. M/S.KASTURI & SONS LTD., 859 & 860, ANNA SALAI, CHENNAI-600 002. PAN AAACK3000H. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHAJI P JACOB, IRS, COMM ISSIONER OF IT RESPONDENT BY : SHRI VIKRAM VIJAYARAGHAVAN, ADVOCATE. DATE OF HEARING : 13 TH MARCH, 2012 DATE OF PRONOUNCEMENT : 13 TH MARCH, 2012 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT: THIS APPEAL FILED BY THE REVENUE RELATES TO THE ASSESSMENT YEAR 2000-01. THE APPEAL IS DIRECTED AG AINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-II I AT CHENNAI, DATED 15-7-2011. THE APPEAL ARISES OUT OF ORDER - - ITA 1612 OF 2011 2 PASSED BY THE ASSESSING OFFICER TO GIVE EFFECT TO T HE ORDER OF THE TRIBUNAL IN ITA NO.189(MDS)/2007DATED 25-1-2008. 2. THE ONLY GROUND RAISED BY THE REVENUE IN THE PRESENT APPEAL IS THAT THE COMMISSIONER OF INCOME-T AX(APPEALS) HAS ERRED IN ALLOWING THE CLAIM OF SOFTWARE EXPENDI TURE OF ` 30,54,207/- AS REVENUE EXPENDITURE. 3. WE HEARD SHRI SHAJI P JACOB, THE LEARNED COMMISSIONER OF INCOME-TAX APPEARING FOR THE REVENU E, AND SHRI VIKRAM VIJAYARAGHVAN, THE COUNSEL APPEARING FO R THE RESPONDENT-ASSESSEE. WE HAVE GONE THROUGH THE DETA ILS OF THE SOFTWARE EXPENSES INCURRED BY THE ASSESSEE. EVEN T HOUGH THE TOTAL AMOUNT COMES TO ` 34,90,707/-, WE FIND THAT IT IS MADE UP OF 37 ITEMS PROCURED BY THE ASSESSEE AT DIFFERENT POIN TS OF TIME FOR APPLYING AT DIFFERENT OPERATIONAL LEVELS OF THE NEW SPAPER PUBLISHING BUSINESS CARRIED ON BY THE ASSESSEE. TH ESE EXPENSES WERE INCURRED FOR ACQUIRING SOFTWARE FOR D IFFERENT APPLICATIONS. THE EXPENSES HAVE NOT BEEN INCURRED FOR ACQUIRING A COMPOSITE SOFTWARE, RENDERING INDIVIDUAL APPLICAT ION. THESE SOFTWARES DO NOT FORM INTO AN ASSET. THEY ARE SEVE RAL IN NATURE. THEY ARE ALL REGULAR EXPENSES NECESSARY IN CARRYING OUT THE - - ITA 1612 OF 2011 3 ACTIVITIES OF THE ASSESSEE. THEREFORE, WE FIND THA T THE COMMISSIONER OF INCOME-TAX(APPEALS) IS JUSTIFIED IN HOLDING THAT THE EXPENSES ARE REVENUE IN NATURE. 4. IN RESULT, THIS APPEAL FILED BY THE REVENUE IS LIABLE TO BE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON TUESDAY, THE 13 TH OF MARCH, 2012 AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 13 TH MARCH, 2012. V.A.P. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT (4) CIT(A) (5) D.R. (6) G.F.