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The Tax Publishers2020 TaxPub(DT) 0996 (Bang-Trib) INCOME TAX ACT, 1961
Section 154
Where Supreme Court in the case of Punjab State Industrial Development Corporation Ltd., ((1997) 225 ITR 792 (SC) : 1997 TaxPub(DT) 919 (SC) clearly settles the law on the question whether fees paid to ROC on expansion of share capital is capital or revenue and has laid down that the expenditure is capital expenditure and while concluding the assessment, AO overlooked the aspect of disallowance of fees paid to ROC which was evident from the record, therefore, no infirmity in the action of AO and appeal of assessee was dismissed.
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Rectification under section 154 - Mistake apparent from record - Fees paid to ROC on expansion of share capital -
Assessee paid fees to Registrar of Company (ROC) towards increase in share capital. AO did not disallow the claim of assessee for deduction on account of fees paid to ROC for increase in share capital. AO realizing that ROC filing fees was not disallowed in assessment concluded under section 143(3), initiated proceedings under section 154 disallowed the ROC filing fees. Held: Decision of Supreme Court in the case of Punjab State Industrial Development Corporation Ltd., ((1997) 225 ITR 792 (SC) : 1997 TaxPub(DT) 919 (SC) clearly settles the law on the question whether fees paid to ROC on expansion of share capital is capital or revenue and has laid down that the expenditure is capital expenditure. While concluding the assessment, AO overlooked the aspect of disallowance of fees paid to ROC which was evident from the record. No infirmity in the action of AO. Therefore, it could not be said that there can be different views on the question whether fees paid to ROC on expansion of capital base is capital expenditure or revenue expenditure. Accordingly, appeal of assessee was dismissed.
Followed:Punjab State Industrial Development Corporation Limited v. CIT (1997) 225 ITR 792 (SC) : 1997 TaxPub(DT) 919 (SC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2014-15
IN THE ITAT, BANGALORE BENCH
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