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2010 (7) TMI 1022 - AT - Income Taxdeduction of payment made to AWSC - HELD THAT:- we hold that the AO was in error in not following the order of the Tribunal on the very same issue on identical facts and circumstances and also in deviating, without reasons, from the observation of his predecessor A.O and also we hold that the first appellate authority was in error in confirming the order of the A.O. In the result, we allow this ground of the assessee and direct the AO to allow deduction of payment made to AWSC on cash basis. disallowance of repair and maintenance expenditure - HELD THAT:- The expenditure on repairs, as per the AO, are in the capital field. We are unable to endorse such a view. Just because the assessee has to incur expenses of repairs and maintenance, when the premises is given on lease, it cannot be held that the same becomes inadmissible. In any event, adhoc disallowances cannot be upheld. Respectfully applying the proposition laid down in case laws to the facts in the case of CIT vs. Binny Ltd. [1994 (11) TMI 27 - MADRAS HIGH COURT] and CIT vs. Jafarbhai Akbarlal and Bros. [1992 (1) TMI 17 - BOMBAY HIGH COURT] we delete the adhoc disallowance as confirmed by the first appellate authority, as none of the expenditure mentioned is in the capital field. adhoc disallowance from out of professional fees paid, travel and conveyance expenses, staff training expenses, motor car expenses, telephone, fax and courier expenses and miscellaneous expenditure - HELD THAT:- The first appellate authority, in our considered opinion, has also not judiciously dealt with the matter. No disallowance can be made just for the sake of disallowance. In view of the lack of proper appreciation of the facts and lack of investigation and proper reasoning, we delete the disallowance and allow the appeal of the assessee. deleting the addition of ₹ 2 crores - HELD THAT:- The CIT(A) held that ''In a scrutiny assessment of this nature, specific additions should be made and where the estimate is inevitable proper opportunity should be given to the appellant and a proper basis should be determined of the estimated disallowance. This has not been done in this case. This addition is, therefore, not sustainable and is ordered to be deleted. The appellant gets a relief of ₹ 2 crore''. Therefore, We agree with these findings of the CIT(A) and dismiss the appeal of the Revenue. deletion of penalties u/s 271(1)(c) - THAT, we have deleted all the additions/disallowances made for both the assessment years in the quantum appeal, the penalties have no legs to stand on. Thus we quash the penalties levied for the assessment years 2003-04 and 2004-05 u/s 271(1)(c) and allow the appeals of the assessee. In the result, we direct the AO to grant deduction to the assessee on all the remittances made to AWSC and claimed as deduction, and also to delete the addition as income under para 8.2(A) of the agreement with AWSC.
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