The Commissioner of Income-tax, Goa v. Zuari Industries Ltd - 2020-LL-0102-8

Citation	2020-LL-0102-8
Appellant Name	The Commissioner of Income-tax, Goa
Respondent Name	Zuari Industries Ltd.
Court	HIGH COURT OF BOMBAY AT GOA
Relevant Act	Income-tax
Date of Order	02/01/2020
Judgment	View Judgment
Keyword Tags	deferred revenue expenditure • books of account • revenue expenditure • interest on borrowings • amortised expense
Bot Summary:	JUDGMENT: On 16th June 2008, this Appeal was Admitted on the following substantial questions of law: Whether on the facts and in the circumstances of the case, the ITAT was justified in holding that interest of Rs.36,98,483/- paid on borrowings, TXA No. 60/2008 2 capitalized in the books of account for setting up of Argon Gas Plant as a revenue expenditure, even before putting the said Plant into operation Whether on the facts and in the circumstances of the case, the ITAT was justified in holding that the amount of Rs.88,63,750/- paid to Texmaco, as deferred revenue expenditure allowing the payment to be amortized for a period of 8 years 2. Similar questions arose in a connected Appeal being TXA NO. 51/2008. The parties agree that the decision in TXA No. 51/2008 shall govern the issues in the present Appeal also. In TXA 51/2008, which is disposed by a judgment of even date, we have answered the point no. For the reasons mentioned in the judgment in TXA No. 51/2008, we pass the following order: TXA No. 60/2008 3 The Appeal is partly allowed. The impugned order passed by the ITAT to the extent of issue no. In the circumstances, there shall be no order as to costs.

IN HIGH COURT OF BOMBAY AT GOA TAX APPEAL NO. 60 OF 2008 Commissioner of Income Tax, having office at Aayakar Bhavan, Patto Plaza, Panaji, Goa. Appellant Versus Zuari Industries Ltd., having office at Jaikisan Bhawan, Zuarinagar, Goa 403 726. . Respondent Ms. Amira Razaq, Standing Counsel for Appellant. Mr. Madhur Agarwal with Mr. P. Arolkar, Advocates for Respondent. Coram:- M.S. SONAK & C.V. BHADANG, JJ. RESERVED ON: 22nd November, 2019 PRONOUNCED ON: 2nd January, 2020 (Signed judgment is pronounced by M.S. Sonak, J. as per clause (i) of Rule 1 of Chapter XI of Bombay High Court Appellate Side Rules as C.V. Bhadang, J. is sitting at Mumbai.) JUDGMENT: (Per C.V. Bhadang, J.) On 16th June 2008, this Appeal was Admitted on following substantial questions of law: (I) Whether on facts and in circumstances of case, ITAT was justified in holding that interest of Rs.36,98,483/- paid on borrowings, TXA No. 60/2008 2 capitalized in books of account for setting up of Argon Gas Plant as revenue expenditure, even before putting said Plant into operation ? (II) Whether on facts and in circumstances of case, ITAT was justified in holding that amount of Rs.88,63,750/- paid to Texmaco, as deferred revenue expenditure allowing payment to be amortized for period of 8 years ? 2. Similar questions arose in connected Appeal being TXA NO. 51/2008. parties agree that decision in TXA No. 51/2008 shall govern issues in present Appeal also. In TXA 51/2008, which is disposed by judgment of even date, we have answered point no. (I) against appellant and in favour of assessee, while point no. (II) has been answered in favour of appellant and against assessee. said decision would govern present Appeal also. 3. For reasons mentioned in judgment in TXA No. 51/2008, we pass following order: TXA No. 60/2008 3 Appeal is partly allowed. impugned order passed by ITAT to extent of issue no. (II) above, is hereby set aside. order passed by AO on aforesaid issue, as confirmed by CIT (Appeals) is hereby restored. In circumstances, there shall be no order as to costs. C. V. BHADANG, J. M. S. SONAK, J. EV Commissioner of Income-tax, Goa v. Zuari Industries Ltd

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