M/s. Neptune Information Solutions Ltd., New Delhi V. DCIT, New Delhi

ITA 1878/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9966 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 29-03-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 26-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUSHA KHURANA SENIOR
• Keywords: Revenue expenditure; Capital expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E : NEW DELHI) BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.1878/DEL./2010 (ASSESSMENT YEAR : 2003-04) M/S. NEPTUNE INFORMATION SOLUTIONS LTD., VS. DCIT, CIRCLE 13 (1), 70, NAJAFGARH ROAD, TOWER 1, B-39, NEW DELHI. DELHI 110 015. (PAN : AAACN2754P) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : MS. ANUSHA KHURANA, SENIOR DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF CIT (APPEALS)- XVI, NEW DELHI DATED 4.1.2010. THE GROUNDS OF APPE AL TAKEN BY THE ASSESSEE ARE AS UNDER :- 1. THAT THE DISALLOWANCE OF RS.10,51,199/- LEASE P REMIUM IS ILLEGAL AND UNJUSTIFIED AND, THEREFORE, SHOULD BE D ELETED. 2. THAT, ALTERNATIVELY, IF IT IS HELD THAT LEASE PR EMIUM RS.10,51,199/- IS NOT A REVENUE EXPENSE, THEN THE S AME MAY BE HELD AS CAPITAL EXPENDITURE ALLOWABLE FOR COMPUTATI ON OF CAPITAL GAINS BECAUSE THE PLOT FOR WHICH THE AMOUNT WAS PAI D WAS SOLD IN SUBSEQUENT YEAR. 3. THAT THE ASSESSEE-COMPANY CRAVES LEAVE TO ADD OR RAISE ANY OTHER GROUND AT THE TIME OF HEARING OF APPEAL. ITA NO.1878/DEL./2010 2 2. NONE ATTENDED ON BEHALF OF THE ASSESSEE. LD. DR WAS HEARD. 3. AFTER HEARING THE LEARNED DR, WE FIND THAT HE AS SESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL BEFORE THE CIT (A) :- 1. THAT THE DISALLOWANCE OF RS.10,51,199/- LEASE P REMIUM IS ILLEGAL AND UNJUSTIFIED AND, THEREFORE, SHOULD BE D ELETED. 2. THAT, ALTERNATIVELY, IF IT IS HELD THAT LEASE PR EMIUM RS.10,51,199/- IS NOT A REVENUE EXPENSE, THEN THE S AME MAY BE HELD AS CAPITAL EXPENDITURE ALLOWABLE FOR COMPUTATI ON OF CAPITAL GAINS. 3. THAT THE ASSESSEE-COMPANY CRAVES LEAVE TO ADD OR RAISE ANY OTHER GROUND AT THE TIME OF HEARING OF APPEAL. AFTER GOING THROUGH THE ORDER OF CIT (A), WE FIND T HAT HE HAS DECIDED THAT LEASE PREMIUM PAID BY THE ASSESSEE IS A CAPITAL EXP ENDITURE WHICH IS REQUIRED TO BE CAPITALISED IN THE COST OF LAND. AFTER HEARI NG THE LEARNED DR AND GOING THROUGH THE CASE RECORD, WE HOLD THAT THIS WAS THE CAPITAL EXPENDITURE AND NOT ALLOWABLE AS REVENUE EXPENDITURE. 4. FURTHER, THE ALTERNATE PLEA TAKEN IN GROUND NO.2 BEFORE US WHERE IT HAS BEEN PRAYED THAT IF THE LEASEHOLD PREMIUM IS NOT AC CEPTED AS REVENUE EXPENDITURE THEN THE SAME MAY BE HELD AS CAPITAL EX PENDITURE ALLOWABLE FOR COMPUTATION OF CAPITAL GAINS BECAUSE THE PLOT FOR W HICH THE AMOUNT WAS PAID ITA NO.1878/DEL./2010 3 WAS SOLD IN SUBSEQUENT YEAR. THIS GROUND WAS ALSO TAKEN BY THE ASSESSEE BEFORE THE CIT (A) BUT, FROM THE ORDER OF CIT (A), WE FIND THAT HE HAS NOT ADJUDICATED UPON THE SAME. IN VIEW OF THIS, WE RES TORE THE APPEAL TO THE FILE OF THE CIT (A) FOR ADJUDICATING THE ALTERNATIVE GROUND TAKEN BY THE ASSESSEE BEFORE HIM. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 29 TH DAY OF MARCH, 2011 AFTER THE CONCLUSION OF THE HEARING. SD/- SD/- (RAJPAL YADAV) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 29 TH DAY OF MARCH, 2011 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A)-XVI, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.