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2010 (7) TMI 554 - ITAT, MUMBAIDeduction u/s 80-IA(4) - minimum guaranteed charges received by the assessee - Held that: - For the sake of proper understanding, we are splitting this 5000 kgs. into two parts viz., 4000 kgs. actually treated by the assessee and 1000 kgs. which are not treated but payment is made as per agreement with MCGM. Deduction has been negatived by the AO on the income from receipts towards 1000 kgs. by assigning the reason that it can not be held as derived from the eligible undertaking. - Whole of the amount is operational income, be it from actual or notional operation of undertaking. As the relation between income from notional operation and undertaking is direct and not indirect or remote, by no standard can it be viewed as anything other than not derived from the eligible undertaking. - Deduction u/s 80IA allowed. Addition u/s 41(1) - it was noticed by the A.O. that an amount was outstanding since accounting year 2001-2002 - The assessee claimed that there was some dispute with M/s.PHE Consultants which was not yet settled and hence the amount was outstanding. - AO made the addition as deemed income u/s 41(1) - Held that: - it becomes patent that the provisions of section 41(1) are rightly attracted here inasmuch as the assessee claimed deduction for the same in an earlier year and subsequently the amount ceased to be payable as is manifest from the information supplied by M/s PHE Consultants who erased the amount due from assessee by showing Nil balance as recoverable. - Order of AO making addition upheld.
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