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2015 (10) TMI 1282 - GUJARAT HIGH COURTSubsidy received prior to insertion of Explanation 10 to section 43(1) - whether can still be reduced from the cost of assets? - Held that:- On the date when the assessee had invested in fixed capital assets, Explanation 10 to sub-section (1) of section 43 of the Act was not on the statute book and hence, the actual cost came to be computed in terms of the law as existing at the relevant time. Nothing happened in the year under consideration so as to justify the action of reduction from the written down value of the block of assets. Explanation 10 to sub-section (1) of section 43 of the Act came into effect only from 1.4.1999 that too prospectively and, therefore, has no application, more so, when plant itself was set-up in assessment year 1993-94. First question is answered in the negative that is in favour of the appellant assessee and against the revenue. It is, accordingly, held that the Income Tax Appellate Tribunal was not right in law in holding that the amount of subsidy received prior to insertion of Explanation 10 to sub-section (1) of section 43 of the Act can still be reduced from the cost of assets. - Decided in favour of assessee. Deduction u/s 80HHC - ITAT held that for the purpose of calculating deduction u/s 80HHC gross interest income without reducing therefrom the interest expenditure, is required to be excluded - Held that:- As decided in ACG Associated Capsules Pvt. Ltd. v. Commissioner of Income Tax, [2012 (2) TMI 101 - SUPREME COURT OF INDIA] Ninety per cent of not the gross interest/rent but only the net interest/rent, which has been included in the profits of the business of the assessee as computed under the heads ‘PGBP’ is to be deducted under clause (1) of Explanation (baa) to Section 80HHC for determining the profits of the business. Matter remanded back to A.O. to work out the deductions – Decided in favor of assessee by way of remand
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