Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (9) TMI 72 - AT - Income TaxEligibility to claim principal portion of lease rental payments - Nature of expenditure - capital or revenue expenses - Addition made on the ground that the lease is in the nature of financial lease and the principal portion of lease amounts to cost of acquisition of capital assets which is capital in nature - HELD THAT:- Hon’ble High Court of Madras in Simpson and General Finance Co. Ltd. [2014 (4) TMI 215 - MADRAS HIGH COURT] held that entire lease rent would be taxable in the hands of the lessor and the lessor would be entitled for depreciation on leased assets notwithstanding the accounting of the transactions as finance transaction by the lessor. This decision also supports our view as aforesaid. Considering the facts and circumstances of the case, we direct Ld. AO to allow the deduction of principal portion of leased assets. The depreciation, if any, as claimed by the assessee on such assets, shall stand reversed. We order so. The appeal stand allowed accordingly. Disallowance u/s 14A - prayer of AR is that the investment in debentures may be excluded while computing the disallowance - HELD THAT:- We find that investment in debentures would not yield exempt income for the assessee. Therefore, we direct Ld. AO to exclude the same while computing indirect expense disallowance u/r 8D(2)(iii). The appeal stands partly allowed.
|