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2011 (9) TMI 636 - AT - Income TaxConsultation/ development fee - revenue or capital expenditure - Held That:- A perusal of the facts clearly show that assessee and the operators i.e. M/s RHW Hotel Management Services Ltd., agreed on a formula for two types of fee. The amount in question for A.Y. 2001-02 & 2002-03 was on account of providing of technical know-how and expert knowledge prior to the commencement. By own admission of assessee it was not engaged into hospitality business and diversified from business of construction of buildings. In these circumstances, we see no infirmity in the order of CIT(A), holding that the restaurant business was a new business and expenditure was for setting up the same and the expenses were not allowable as business in nature. Deduction under 80IB - Held That:- The built up area of houses in the project, except 5 houses in East End Loni and 6 houses in Avantika Aakriti, did not exceed the statutory limit of 1000 sq. ft.The construction of all the housing projects effectively commenced after the statutory date of 1-10-1998 and therefore, deduction u/s 80-IB(10) was rightly claimed and allowed in the original assessment proceedings. Issue is covered by the ITAT order in assessee’s own case for earlier years. Ground Dismissed. CIT(A) deleted Prior period Expense - Held That:- expenditure in question pertains to consumption of electricity, which was received and payable this year, we see no infirmity in the order of CIT(A), which is upheld. Notional rent on unsold flats - Held That:- M/s Ansal properties and Industries Ltd. in ( 1989 -TMI - 63212 - ITAT DELHI-A ) case decided in favour of asseseee.
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