Delhi High Court
Krishak Bharti Cooperative Ltd vs Assistant Commissioner Of Income ... on 18 August, 2022
$~1388
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 265/2022, CM APPL. 35348/2022 & CM APPL. 35349/2022
KRISHAK BHARTI COOPERATIVE LTD ..... Appellant
Through: Ms. Surekha Raman and Mr.
Purushottam Kr. Jha, Advocates.
versus
ASSISTANT COMMISSIONER OF
INCOME TAX ..... Respondent
Through: Mr. Abhishek Maratha, Sr. Standing
Counsel for Revenue.
% Date of Decision: 18th August, 2022
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
JUDGMENT
MANMOHAN, J (Oral):
CM APPL. 35348-49/2022 (exemption)
Exemptions allowed, subject to all just exceptions.
Accordingly, these applications stand disposed of.
ITA 265/2022
1. Present Income Tax Appeal has been filed challenging the Order
dated 29th December, 2021 passed by the Income Tax Appellate Tribunal
('ITAT') in ITA 2341/Del./2017 for Assessment Year 2010-11.
2. Learned Counsel for the Appellant states that the ITAT erred in
rejecting the claim for amortization of lease premium paid to the Noida
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:22.08.2022
11:06:06
Authority, Vishakhapatnam and Tuticorin Authority, on the ground that such
payment amounts to a Capital expenditure rather than a Revenue
Expenditure.
3. She states that the ITAT has failed to appreciate the true meaning and
effect in law of the terms of the lease deed executed between the Appellant
and Lease hold Authorities namely Noida, Vishakhapatnam and Tuticorin.
4. She submits that the ITAT was not justified in holding that the lease
amount paid would amount to a Capital Expenditure rather than a Revenue
Expenditure especially when no ownership was created by payment of lump
sum premium. She also states that ITAT has erred in not appreciating that
there is no addition to the capital structure but only enables the Appellant to
carry on its business after paying nominal rent and hence lease premium
paid is revenue expenditure.
5. Issue notice. Mr. Abhishek Maratha, learned Senior Standing Counsel
for Revenue accepts notice. He states that in a similar case, where the
Appellant had paid lease premium to the Noida Authority, the learned
Predecessor Division Bench in ITA No. 205/2010 Krishak Bharati
Cooperative Ltd. vs. Deputy CIT and connected appeals has held that the
said expenditure is capital expenditure.
6. In rejoinder, learned counsel for the Appellant states that the
judgment and order passed in ITA No.205/2010 is pending challenge in SLP
(Civil) No. 35813/2012 and other connected appeals before the Supreme
Court.
7. Admittedly, the issues of law and fact in the lease deeds executed
between the Appellant as well as the Noida Authority, Vishakhapatnam and
Tuticorin Authorities are similar to the case decided by the learned
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:22.08.2022
11:06:06
Predecessor Division Bench in ITA No. 205/2010.
8. Consequently, the present appeal is disposed of in terms of the
judgment of the learned Coordinate Bench in ITA No. 205/2010. However,
it is made clear that the present decision will abide by the judgment of the
Supreme Court in SLP (Civil) No. 35813/2012 and other connected appeals.
MANMOHAN, J
MANMEET PRITAM SINGH ARORA, J
AUGUST 18, 2022/msh
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:22.08.2022
11:06:06
