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2014 (9) TMI 1061 - ITAT DELHIDisallowance of expenses on insurance, depreciation, interest on finance and car expenses - CIT(A) deleted the addition - Held that:- CIT(A) deleted such addition by relying on the Tribunal order passed in assessee’s own case for AY 2000-01. The ld. DR could not bring on record any material to indicate that there was any fallacy in such order or in the subsequent years such order has not been followed. Respectfully following the precedent, we approve the view taken by the ld. CIT(A) on this issue.- Decided against revenue Disallowance of interest @ 12% on such interest free loans and advances to the related parties and others - Held that:- the impugned order that interest free loans were given to the persons whose properties were used by the assessee for showrooms and godowns, on which no rent was paid. It can be seen from the impugned order that the AO himself, while passing order u/s 143(3) for the AY 2009-10, accepted the assessee’s submissions on this score and did not make any such addition. When interest free loans were given to the parties from whom the assessee had taken premises for its business purpose without paying any rent, the notional interest on such loans can be considered as quid pro quo of rent. Since the AO has himself accepted the assessee’s case, in his order for AY 2009-10, we hold that no interference can be made in the impugned order on this issue - Decided against revenue Addition on account of conversion expenses - Held that:- The assessee was to use this property of some third person for business purpose and the same was not possible unless it was so converted, the conversion charges in such circumstances could not have been considered as a capital expenditure. The case is not even hit by Expl. 1 to sec. 32(1) inasmuch as payment of such conversion charges cannot be considered as any capital expenditure ‘on the construction of any structure or doing of any work in or in relation to, and by way of renovation or extension of, or improvement to, the building’. We, therefore, hold that such a payment cannot be considered as capital expenditure.- Decided against revenue
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