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2014 (1) TMI 1484 - AT - Income TaxDisallowance at 1% of exempted income u/s 14A - Held that:- Rule 8D is apllicable w.e.f. 24.03.2008 i.e. 2008-09 onwards whereas the A.Y. in appeal is 2007-08 - As laid down in other decisions of the Tribunal CIT(A) held that out of the administrative expenses, expenses to the tune of 1% of the exempt income can be disallowed u/s. 14A - Decided against Revenue. Whether factoring charges liable to TDS - Held that:- Interest is a term relating to a pre-existing debt, which implies a debtor creditor relationship. According to us, unpaid consideration gives rise to a lien over goods sold and not for money lent - Decision in Bombay Steam Navigation Co. Pvt. Ltd. Vs. CIT [1964 (10) TMI 12 - SUPREME Court] followed - Interest on unpaid purchase price was not treated as interest on loan - Before any amount paid is construed as interest, it has to be established that the same is payable in respect of any money borrowed or debt incurred - Discounting charges of Bill of Exchange or factoring charges of sale cannot be termed as interest. The assessee has assessed the income as Del Credere being trading in goods and merchandise and also dealing in securities and which is assessed as income from business and not income from other sources - The expenditure incurred is also on account of business expenditure and not interest expenditure in the nature of interest falling u/s 194A of the Act - These discount/factoring charges do not come within the purview of section 194A and assessee is not liable to TDS on these charges - Decided against Revenue.
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