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2022 (4) TMI 804 - ITAT CHENNAIRoyalty payments treated as capital expenditure - HELD THAT:- Facts being pari-materia the same in this year as per earlier AY year. [2022 (4) TMI 702 - ITAT CHENNAI] we would hold that the royalty payment was to be treated as revenue expenditure. The grounds thus raised stands allowed. Disallowance of excess depreciation - Assessee was engaged in the business of security services for the purpose of secured transportation for ATM services and for the same it was using motor lorries customized as armored/ security vans and vehicles deployed were customized motor Lorries which were used in the business of running them on hire for transportation of valuables - HELD THAT:- It could be seen that majority of the depreciation as claimed by the assessee is on opening written down value (WDV) of the block. The vehicles under consideration form part of 30% Block of Assets - the depreciation on vehicles have been allowed at higher rates in earlier years. AR submitted that similar disallowance as made in earlier years was deleted by learned first appellate authority for which revenue did not prefer any further appeal and thus, the issue has attained finality in earlier years. Keeping in view these facts, we direct Ld. AO to allow depreciation at higher rates as claimed by the assessee. The grounds thus raised stands allowed. Disallowance of Miscellaneous expenditure - HELD THAT:- M/s SDB CIDCO Pvt. Ltd. has expressed desire to obtain and utilize the professional, technical and other specialized skills of Shri Alexander John George for the business integration, operation, due diligence and managing business. The SDB CIDCO Pvt. Ltd. was to be charged for the costs incurred including reimbursement of out-of-pocket third-party costs and expenses. Accordingly, IIFS has raised periodic debit note on the assessee, the copies of which are on record. The copy of the employment contract between IIFS and Shri Alexander John George is also on record. Thus, it could be seen that this employee was in employment of IIFS but it was seconded to the assessee under a contract. The assessee reimbursed IIFS as per the contract and the deduction of the expenditure has been claimed by the assessee. Since the person is an employee of IIFS, Form No.16 would be issued by ISS only. On the basis of all these facts and documentary evidences, there is no reason to deny the deduction of the expenditure to the assessee. Disallowance u/s. 43B - service tax liability was outstanding as on 31.03.2012 - HELD THAT:- Provisions of Sec.43B could not be applied to this expenditure as held by Hon’ble Delhi High Court in Noble & Hewitt (I) (P) Ltd [2007 (9) TMI 238 - DELHI HIGH COURT]. We concur with the decisions provided it could be shown that the liability to pay Service Tax as per relevant Service Tax Rules did not arise before due date of filing return of income. Therefore, we direct Ld. AO to verify this fact and delete the disallowance if the liability to pay Service Tax did not arise as per relevant Service Tax Rules before due date of filing of return of income. The assessee to provide requisite information and substantiate its stand. This ground stand allowed for statistical purposes.
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