COMMISSIONER OF INCOME TAX DELHI CENTRAL Vs. USHA IRON AND FERRO METAL CORPORATION LTD
HIGH COURT OF DELHI
COMMISSIONER OF INCOME TAX DELHI (CENTRAL) - II ARA CENTRE, E-2 JHANDEWALAN EXTN. NEW DELHI
USHA IRON AND FERRO METAL CORPORATION LTD.
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MADAN B.LOKUR, J. -
(1.) The Revenue is aggrieved by an order dated 16th June, 2006 passed by the
Income Tax Appellate Tribunal, Delhi Bench 'A' in ITA No.915/Del/1999, ITA No.
2389/Del/2000 and ITA No.4366/Del/2004 relevant for the assessment years 1995-96
(2.) The Assessee carries on the business of manufacturing and production of
CTD bars as also different types of iron rods. The Assessee used to procure the
raw material, that is, billets from the open market. The Assessee decided to
manufacture the raw material on its own and for this purpose it set up a Steel
Melting Shop. In the course of setting up the Steel Melting Shop, the Assessee
incurred substantial expenditure and this was shown by the Assessee in its books
as capital expenditure incurred. The Assessee also filed its returns on this
(3.) Later the Assessee filed revised returns wherein it claimed that the
expenditure was revenue expenditure having been incurred for the expansion of
its business. On this basis, the Assessee claimed a deduction. The Assessing
Officer did not accept the view canvassed by the Assessee primarily on the
ground that the Assessee had shown the expenditure as being of a capital nature
in its own books.;
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