NUAIRE ENGINEERS P. LTD,MUMBAI vs. ITO 9(2)(3), MUMBAI

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ITA 6422/MUM/2010Status: DisposedITAT Mumbai16 September 2016AY 2005-062 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal allowed deduction for vehicle registration charges as revenue expenditure and directed the AO to allow PF dues paid before the return filing date. However, disallowances for increase in share capital and stamp duty charges were confirmed.

What were the facts?

The assessee appealed against the CIT(A)'s order for AY 2005-06. The appeal involved additions related to vehicle registration charges, increase in share capital, and PF dues.

What were the issues?

Whether vehicle registration charges and PF dues are allowable as revenue expenses, and whether expenses related to increase in share capital are capital in nature.

Which sections of the Income-tax Act were involved?

Section 28,Section 37

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Income Tax Appellate Tribunal, “B”, BENCH MUMBAI

Before: SHRI R.C.SHARMA, AM & SHRI SANDEEP GOSAIN, JM

Hearing: 21/07/2016Pronounced: 16/09/2016

O R D E R PER R.C.SHARMA (A.M): This is an appeal filed by the assessee against the order of CIT(A)- Mumbai, for the assessment years 2005-06. 2. There is a marginal delay in filing the appeal. As the reasons stated for delay was found to be genuine, we condone delay of 43 days in filing appeal and appeal is heard on merit. 3. Ground No.1 relates to sustaining addition of Rs.43,726/- as capital expenditure on account of vehicle registration charges.

4.

We found that amount was paid for registration of vehicle and also including road tax. No new asset has come into existence by payment of registration charges. Accordingly, we direct the AO to allow assessee’s claim for deduction of registration charges as revenue expenses.

5.

Ground No.2 relates to disallowance of capital expenditure for increase in share capital.

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