The jurisdiction of the High Court is limited to substantial questions of law, and concurrent findings of fact by lower courts generally cannot be re-evaluated.

JUDGMENT

Manmohan, J.:

C.M.No.44240/2022

Exemption allowed, subject to all just exceptions.

Accordingly, the application stands disposed of.

ITA No.394/2022

1. Present Income Tax Appeal has been filed challenging the order dated 25th January, 2021 passed by the Income Tax Appellate Tribunal (`ITAT') in ITA 2952/Del./2019 for the Assessment Year 2013-14.

2. Learned counsel for the Appellant states that the ITAT has erred in confirming the findings of CIT (A) on the disallowance under Section 36(1)(iii) of the Income Tax Act, 1961 (`the Act') ignoring the fact that the CIT (A) had wrongfully assumed that the facts of the present case were similar to that of previous Assessment Year 2012-13. He emphasises that the ITAT has erred in assuming that Revenue had accepted the order of CIT(A) for the previous Assessment Year 2012-13 ignoring the fact that the same was after fresh examination by the Assessing Officer during remand proceedings, which was not the case in the present year under consideration.

3. A perusal of the paper book reveals that the CIT(A) in the present case has observed as under:

"5.2 It is noted that similar issue was adjudicated by my predecessor for A.Y. 2012-13 in vide order dated 30.11.2016 in Appeal No: 118/CIT(A)-7/Del/15-16 which was allowed. Operative part of the order is reproduced as under:

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"2.5 Thus it can be seen that the said ratio of capitalization of interest cost by the assessee company is merely on the basis of the assumption of the assessee based on the cost of 2500 crores of LNG terminal adopted in the year 20. The assumption does not have any base or proper support or scientific reasoning. The CWIP as on date is 3845.22 crores on account of Plant & Machinery and construction stores only. In fact the other infrastructure like building, roads etc are also to be apportioned to the CWIP which the assessee company has not made. Thus there is no justification for capitalization of finance cost/interest in the ratio of 1:3 as explained by the assessee. Thus it is clear that the ratio adopted by the assesse company is without and proper base, supporting documentary evidence and justification and therefore has been used as a tool to divert more cost in profit and loss a/c. therefore, the apportionment done by the assessee is not acceptable and in the absence of any rational basis, the same is required to be done on a more scientific and reasonable method.

2.6 On the perusal of the balance sheet of the assessee company, it is noticed that the entire outstanding liability of the assessee company bearing interest is Rs.8,998.99 crores (8676.52 crores, Non-current liabilities + 322.47 crores, current liabilities). The interest cost is thus required to be reallocated in the ratio of CWIP of 3845.22 crores and total interest bearing liabilities of Assessee Company i.e. 8998.99 crores. Accordingly, the interest to the extent of Rs. 351.25 crores is required to be capitalized. Keeping in view that the assessee has already capitalized on interest of Rs. 179.43 crores, the balance interest of 145.82 crores is further required to be disallowed u/s 36(1)(iii) of the Act, and to be capitalized towards the cost of CWIP and added to the income of the assessee company for the computation of taxable income of the assessment year under consideration.

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5.3 Since the facts are similar in the present appeal, no interference is called for with my predecessor. Therefore, addition of Rs.2,15,05,00,000/u/s 36(1)(iii) on account of Interest attributed to work in progress made by the AO is deleted. This ground of appeal is ruled in favour of the appellant."

4. This Court also finds that the Revenue has not provided any specific fact either i