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2017 (12) TMI 1845 - AT - Income TaxDisallowance of provision for contractual obligations - HELD THAT:- As it is apodictic that actual payments against the provisions made by the assessee for earlier year were negligible upto assessment year 2013-14. Assessee was unable to furnish any details regarding the projects so far completed by the assessee with delay and the actual amount of liquidated damages paid for such overrun. While there can be no quarrel on the claim of the assessee that actual liquidated damages payable on account of delay attributable to it, is a crystallized liability, in our opinion requisite details for supporting the claim made by the assessee is not on record. Not only the assessee has to show that there was indeed a delay, it is also required to show what part of such delay was attributable to its own fault and what claim was made by the client as per contractual provision, for such damages. In the facts and circumstances of the case, we are of the opinion that the issue requires a fresh look by AO. We therefore set aside the orders of the lower authorities and remit the issue back to the file of the ld. Assessing Officer for consideration afresh in accordance with law. Disallowance being provision for warranty - HELD THAT:- What we find is that for assessment year 2009-10 though the claim was allowed by the ld. Commissioner of Income Tax (Appeals), the Tribunal had reversed such finding of the ld. Commissioner of Income Tax (Appeals) and upheld the disallowance for warranty provisions. Nothing was shown before us to take a different view for the impugned assessment year. Ground of the assessee stands dismissed. Disallowance u/s.14A - HELD THAT:- Hon’ble Delhi High Court in the case of Joint Investment P. Ltd [2015 (3) TMI 155 - DELHI HIGH COURT] disallowance u/s.14A of the Act cannot exceed the exempt income claimed by the assessee. We restrict the disallowance accordingly. Addition of retention money - Accrual of income in which year ? - HELD THAT:- We find that the question whether retention money could be considered as part of income had come up before the Hyderabad Bench of the Tribunal in assessee’s own case for assessment year 2007-08 [2013 (9) TMI 372 - ITAT HYDERABAD] Tribunal had set aside the issue to the file of the ld. Assessing Officer for verifying the correctness of the claim of the assessee that retention money was offered as income in the years in which these were received. Accordingly, for the impugned assessment year also, we give similar directions as given by the Tribunal - Ground of the Revenue is partly allowed for statistical purpose. Allowance of depreciation on technical know-how - HELD THAT:- No doubt, Revenue has claimed that assessee had not become absolute owner of the technical know-how and the supplier company continued to enjoy the ownership of such technical know-how. However, in our opinion, once assessee had paid the money and acquired the technical know-how, it become an intangible asset, eligible for claiming depreciation u/s.32(ii) of the Act. The question whether the same vendor had given the same technical know-how for other persons, is in our opinion, irrelevant in deciding the question of eligibility of the assessee for claiming depreciation. We therefore do not find any reason to interfere with the order of the ld. Commissioner of Income Tax (Appeals) in this regard. Ground stands dismissed.
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