IN THE INCOME TAX APPELLATE TRIBUNAL GUWAHATI BENCH, GUWAHATI (VIRTUAL HEARING AT KOLKATA)

SHRI MANOMOHAN DAS, JUDICIAL MEMBER SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER Assessment Year: 2017-18 Axom Communications & Cable Private Limited, 5^th Floor, Surya Tower, Ulubari B, Baruah Road, Guwahati Kamrup – 781007, Assam, Guwahati [PAN: AAKCA1364Q] .....................…...………… Appellant vs.

ACIT, Cir-3, Guwahati, Aayakar Bhavan, Christianbasti, G.S. Road, Guwahati - 781007 ...…..….......................... Respondent Appearances by:

Assessee represented by : Chetan Agarwal, AR Department represented by : Kausik Ray, JCIT Date of concluding the hearing : 07.08.2025 Date of pronouncing the order : 11.08.2025

ORDER

PER SANJAY AWASTHI, ACCOUNTANT MEMBER:

1. This appeal arises from order dated 29.03.2025, passed u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”) by the Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi.

1.1 In this case, the Ld. AO has passed a brief order in which an addition of Rs. 23,60,240/- has been made on account of interest paid proportionately against plant and machinery which was not allegedly used during the year.

1.2 The assessee carried this matter in appeal before the Ld. CIT(A) where he could not succeed mainly because of finding in the impugned order as under:

“5.3 Ostensibly the appellant has charged interest of Rs.23,60,240/- in P & L Account. Undoubtedly the appellant has taken loan of more than Rs.9 crores and purchased new plant & machinery and also put the same into use during the year under consideration. The AO disallowed interest as the interest on loan for purchase of WIP assets is not qualified to be charged in the P & L Account. From the provisions of section 36(1)(iii) it is clear that any interest paid on loan for purchase of plant & Machinery is to be capitalized till it is first put to use. The appellant has nowhere mentioned that on what date such assets were put to use and what is the amount of interest paid till the date of first put to use the assets. In other words there is no bifurcation of interest paid which has been capitalized and which has been taken into P & L Account. Even during the appellate proceedings appellant did not clarify the correct position. Therefore, there is no infirmity in the order of the AO in disallowance of the interest of Rs.

23,60,240/-.

5.4 As the amount of interest of Rs.23,60,240/- is to be capitalized However, the appellant has given very vague reply therefore, it cannot be ascertained that such asset will fall in which category of the depreciable asset. Further, the appellant has not asked for depreciation on capitalized amount.

1.2 Aggrieved with this action of Ld. CIT(A), the assessee has approached the ITAT with the following single ground of appeal:

“1. The Ld. CIT(A) has erred in law as well as on fact in upholding an addition of Rs. 23,60,240/- being made by Ld. AO by treating interest paid on loans for acquiring plant & machinery claimed in profit and loss account as capital expenditure.”

2. Before us, the Ld. AR presented a paper book running into 56 pages which contained additional evidences which were neither before the Ld. AO or the Ld. CIT(A). The Ld. AR attempted to demonstrate that the authorities below had mis-directed themselves in terms of working out the impugned disallowance.

2.1 The Ld. DR pointed out that none of the documents contained in the paper book were before any of the authorities below and hence he would have no objection in case this matter was to be remanded back to the file of Ld. AO for fresh verification and then passing an assessment order.

3. We have carefully considered the rival submissions and have also gone through the records. We find that the assessee has presented a number of new documents before us, albeit without a proper application under Rule 29 of the ITAT Rules. Be that is may, it is felt that in the interests of substantive justice this matter deserves to be remanded back to the file of Ld. AO for fresh as