1. A Co wanted to go for IPO .
And it has increased its authorised capital by paying fees at Roc . But it has not gone for public issue during the year when it has paid the fees with ROC.In subsequent year it is preparing for public issue. Whether it is allowable expenses ?
2. Whether share issue expenses is capital or revenue ?
Fees paid to ROC for increasing Authorised share capital is Capital expenditure -Mohan Meakin Breweries Ltd V/s CIT (NO.2) (1979)117 ITR 505 HP.
It is not deductible as it is a capital expenditure- Punjab State Industrial Development Corp. Ltd V/s CIT (1997)225 ITR 792/93 TAXMANN 5 (SC).
Regarding your first question, I completely agree with Mr. Tushar.Only fees paid for registration of a company is deductible. Fees paid for increase in share capital is not fees for registration of the company, and hence is not amortisable under the provisions of Sec 35D.CIT v. Hindustan Insecticides Ltd. [2001] 250 ITR 338 (Delhi).
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