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2012 (9) TMI 473 - ITAT, DELHIDisallowance of Provision for doubtful debt - Assessee is an NBFC – Assessee claim provision for doubtful debts as per RBI guidelines – Held that:- Following Special Bench decision of ITAT in the case of New India Industries Ltd. (2007 (10) TMI 325) and wherein it was held that RBI Act do not over-ride the provisions of the Income Tax Act, 1961 so far as compliance of Income tax provisions are concerned. Therefore, provisions for bad and doubtful debt though statutorily required under the RBI guidelines do not qualify for deduction as business expenditure. Appeal decides in favour of revenue Disallowance of expenses attributable to exempted income u/s 14A - Assessee had earned interest on bonds exempt u/s 10(23G) – Held that:- AO had to first give finding as to the fact that he is not satisfied with the correctness of the claim in respect of such expenditure. While rejecting the claim of assessee with regard to expenditure or no expenditure as the case may be in relation to exempt income, the AO would have to indicate cogent reasons for the same. Therefore case remand back to AO. Disallowance of excess depreciation being @ 40% on vehicles - Assessee had claimed depreciation on motor lorries/taxis and motor cars at higher rate of 40% in case of motor lorries/taxies instead of 20% - There was no fresh leasing transactions have been undertaken in the assessment year - 40% has been allowed by the Tribunal in previous assessment year – Held that:- As decided by Delhi High Court in case of MGF (2006 (7) TMI 125) that vehicles owned by a NBFC leased to third party are eligible for higher rate of depreciation @ 40%. Appeal decides in favour of assessee. Addition on account dividend income – Assessee claim exemption u/s 10(33) for the period 1999 to 2007 - AO made addition on the basis that dividend income during that year was not exempt as section not applicable to assessment year 2003-04 – Held that:- AO did not talk about sec. 10(34) or sec. 80M, as same was applicable for the respective year. Since the claim of assessee was not examined by the Assessing Officer u/s 80M. Case remand back to AO. Charging of interest u/s 234B & 234D and withdrawal of interest u/s 244A – Held that:- As charging of interest u/s 234D is not applicable to the said assessment year. As regards interest u/s 234B and 244A, These are of consequential nature and the determination of interest under these sections will depend upon the final outcome of the case. Appeal decides in favour of assessee.
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