Case Law Details
Southern Hills Developers Pvt. Ltd. Vs DCIT (Karnataka High Court)
Facts- The Assessing Officer during assessment proceedings noted that the assessee has shown sales on the basis of the recognition of revenue from a project which was jointly executed with a partner. The Assessing Officer opined that finance charges claimed by the assessee were not related to the borrowings used for the said project but may be used in respect of loans raised for work in progress where revenue had not been recognized. Accordingly, the Assessing Officer disallowed the entire amount claimed as finance charges and treated the same as capitalized under work progress.
Conclusion- Finance charges claimed by the assessee were allowed in the previous year of the assessee in support of the contention that the assessment made during the earlier years ought to have been considered during the year in question, the judgment relied on Sridev Enterprises also has not been properly appreciated by the Tribunal.
Having regard to these facts and circumstances of the case, we deem it appropriate to set aside the impugned order and remand the matter for re-consideration by the Tribunal keeping open all the rights and contentions of the parties.
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