Income Tax Appellate Tribunal - Ahmedabad
M/S. Atlanta Global Real Est. India (P) ... vs The Dy.Cit, Circle-1(1),, Baroda on 9 May, 2018
*Mh* अहमदाबाद ।
आयकर अपील य अ धकरण, अहमदाबाद यायपीठ
IN THE INCOME TAX APPELLATE TRIBUNAL
" D " BENCH, AHMEDABAD
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BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER
And SMT MADHUMITA ROY, JUDICIAL MEMBER
आयकर अपील सं./I.T.A.
No. 1882/Ahd/2015
( नधा रण वष / Assessment Year : 2011-12)
M/s. Atlanta Global Real Est. बनाम/ DCIT,
India Pvt. Ltd., Vs. Circle - 1(1),
nd
B-9, 2 Floor, Vandematram Baroda.
Flat 42/1, Arunoday Society,
Alkapuri, Baroda.
थायी ले खा सं . /जीआइआर सं . / PAN/GIR No. : AAGCA 3046 D
(अपीलाथ /Appellant) .. ( यथ / Respondent)
अपीलाथ ओर से / Appellant by : Shri Sunil Talati, A.R.
यथ क ओर से/Respondent by : Shri O. P. Pathak, Sr.D.R
ु वाई क तार ख /
सन Date of Hearing 02/05/2018
घोषणा क तार ख /Date of Pronounce ment 09/05/2018
आदे श / O R D E R
PER PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER:
The captioned appeal has been filed at the instance of the Assessee against the order of the Commissioner of Income Tax(Appeals)-1, Vadodara [CIT(A) in short] dated 28/04/2015 arising in the assessment order passed under s.143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") dated 26/03/2014 relevant to Assessment Year (AY) 2011-12.
ITA No.1882/Ahd/2015M/s. Atlanta Global Real Est. India Pvt. Ltd. Vs. DCIT Asst. Year 2011-12 -2-
2. The assessee in the captioned appeal has disputed the action of the Ld. CIT(A) in confirming the disallowance of Rs.2,02,017/- out of Rs.2,37,295/-, treating the same to be of capital nature allegedly in disregard of provisions of section 35D of the Act.
3. Briefly stated, the assessing officer in the course of the scrutiny assessment observed that the assessee has wrongly claimed deduction of Rs.2,02,017/- on account of preliminary expenses written off and another amount of Rs.35,278/- towards pre-incorporation expenses. The AO drew inference against the Assessee, on the ground that the auditor's report in form no 3CD does not permit amortization of such expenses. The aggregate amount of Rs.2,37,295/- was thus disallowed and added to the total income of the assessee.
4. Aggrieved, the assessee preferred appeal before the CIT(A). The CIT(A) found merit in the claim of expenses to the extent of Rs.35,278/- towards pre-incorporation expenses and thus allowed the aforesaid amount. However, with regard to the pre-operative expenses of Rs.2,02,017/-, the CIT(A) did not find any good reason to reverse the action of the AO and to allow the claim of amortization of expenditure in terms of section 35D of the Act.
ITA No.1882/Ahd/2015M/s. Atlanta Global Real Est. India Pvt. Ltd. Vs. DCIT Asst. Year 2011-12 -3-
5. Further aggrieved, the assessee preferred appeal before the Tribunal.
6. The Ld. AR for the assessee Mr. Sunil Talati submitted at the outset that the disallowance in question of Rs.2,02,017/- mainly comprises of amount deposited with the registrar of companies towards incorporation and other incidental expenses such as printing of Memorandum of Association and Articles of Association and stamping charges etc. He thus submitted that merely on account of delinquency on the part of the tax auditor in not commenting on its allowability, the expenditure which is otherwise permissible in law, cannot be denied to the assessee.
7. The Ld. DR relied upon the order of the authorities below.
8. We have carefully considered the rival submission and perused the order of the authorities below. It is apparent that the expenses incurred towards filing fees, stamp duty, printing charges of Memorandum of Association etc., are clearly amortizable expenditure within the sphere of Section 35D of the Act. The revenue has not disputed any other aspect of Section 35D for alleged ineligibility. We thus find merit in the plea of the assessee for allowability of amortization of expenditure as claimed. Accordingly, the assessing officer is directed to delete the disallowance on this score.
ITA No.1882/Ahd/2015M/s. Atlanta Global Real Est. India Pvt. Ltd. Vs. DCIT Asst. Year 2011-12 -4-
9. In the result, appeal of the assessee is allowed.
This Order pronounced in Open Court on 09/05/2018
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(MADHUMITA ROY) (PRADIP KUMAR KEDIA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Ahmedabad; Dated 09/05/2018
Priti Yadav, Sr.PS
आदे श क त"ल#प अ$े#षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent.
3. संबं'धत आयकर आयु)त / Concerned CIT
4. आयकर आयु)त(अपील) / The CIT(A)- 1, Vadodara.
5. ,वभागीय /त/न'ध, आयकर अपील य अ'धकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड4 फाईल / Guard file.
आदे शानुसार/ BY ORDER, स या,पत /त //True Copy// उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad
1. Date of dictation 03/05/2018 (dictation-pad 3 pages attached at the end of this appeal-file)
2. Date on which the typed draft is placed before the Dictating Member ...04/05/2018
3. Other Member...
4. Date on which the approved draft comes to the Sr.P.S./P.S.................
5. Date on which the fair order is placed before the Dictating Member for pronouncement......
6. Date on which the fair order comes back to the Sr.P.S./P.S.......
7. Date on which the file goes to the Bench Clerk.....................
8. Date on which the file goes to the Head Clerk..........................................
9. The date on which the file goes to the Assistant Registrar for signature on the order..........................
10. Date of Despatch of the Order..................