Bilcare Limited, Pune V. Addl. CIT, Pune

ITA 718/PUN/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 3245 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 17-06-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ABHAY DAMLE
• Keywords: Revenue expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRAKUMAR YADAV AND SHRI D. KARUNAKARA RAO ITA NO. 718/PN/09 (ASST. YEAR 2006-07) BILCARE LIMITED GAT NO. 1028 SHIROLI, TAL. KHED DIST. PUNE 410 505 PAN NO. AABCB2242F .... APPELLANT VS. ADDL. CIT, CIRCLE-8, PUNE . RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK REVENUE BY : SHRI ABHAY DAMLE ORDER PER D. KARUNAKARA RAO AM THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-III, PUNE, FOR A.Y 2006-07 AND THE GROUNDS RAISED IN THIS APPEAL ARE AS UNDER:- 1) THE LEARNED CIT(A) ERRED IN CONFIRMING THE DIS ALLOWANCE OF INTEREST OF RS. 2,20,84,285/- WITHOUT APPRECIATING THAT THE SAME WAS ALLOWABLE AS A REVENUE EXPENDITURE. 2) THE LEARNED CIT(A) ERRED IN HOLDING THAT THE IN TEREST WAS CAPITAL IN NATURE ON THE GROUND THAT THE ASSESSEE HAD ALSO CAP ITALIZED THE SAME IN ITS BOOKS. 3) THE LEARNED CIT(A) FAILED TO APPRECIATE THAT- A. THE ABOVE INTEREST WAS PAYABLE ON THE LOW COST LOANS TAKEN FOR REPAYMENT OF THE EARLIER HIGH COST LOANS AND AS THESE LOANS WERE NOT UTILIZED FOR PURCHASING ANY NEW ASSE TS DURING THE YEAR, THE INTEREST OF RS. 2,20,84,285/- WAS RIGH TLY ALLOWABLE AS A REVENUE EXPENDITURE U/S. 36(1)(III). B. THE LEARNED A.O HAD NOT PROVED ANY NEXUS THAT THE INTEREST BEARING FUNDS WERE UTILIZED FOR ACQUISITION OF FIXE D ASSETS AND HENCE, THE DISALLOWANCE WAS NOT JUSTIFIED. 4) WITHOUT PREJUDICE TO THE ABOVE GROUNDS, THE ASS ESSEE SUBMITS THAT EVEN ASSUMING WITHOUT ADMITTING THAT THE LOANS WERE UTILIZED FOR ACQUISITION OF NEW ASSETS DURING THE YEAR, THE INTE REST ON SUCH LOANS ONLY TILL THE DATE OF INSTALLATION OF THE ASS ETS COULD BE CAPITALIZED AND NOT THE ENTIRE INTEREST. ITA NO. 718/PN/09 A.Y: 2006-07 PAGE 2 OF 2 2. AT THE TIME OF HEARING, LD. COUNSEL FOR THE ASSESS EE MR. NIKHIL PATHAK MENTIONED THAT INSTEAD OF WITHDRAWING THE APPEAL, HE PREFER NOT TO PRESS THE GROUNDS RAISED IN THE APPEAL OF THE ASSESSEE. CONSIDE RING NO OBJECTION FROM THE DR SIDE, WE ARE OF THE VIEW THAT THE APPEAL IS DISMI SSED AS NOT PRESSED. 3. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 04 TH NOVEMBER, 2010. SD/- SD/- (SHAILENDRAKUMAR YADAV) (D.KARUNAKAR A RAO) JUDICIAL MEMBER ACCOUNTANT MEMBE R PUNE DATED THE 04 TH NOVEMBER, 2010 R COPY OF THE ORDER IS FORWARDED TO : 1. ASSESSEE 2. ACIT, ICHALKARANJI CIRCLE, ICHALKARANJI 3. CIT(A), KOLHAPUR 4. CIT-I, KOLHAPUR 5. D.R. ITAT B BENCH BY ORDER ASSISTANT REGISTRAR I.T.A.T PUNE