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2010 (4) TMI 690 - AT - Income TaxComputation of income - Arms length price - Depreciation - Addition - distinction between a business connection and a permanent establishment - Held that:- business connection is relevant for the purpose of application of section 9, the concept of permanent establishment is relevant for assessing the income of a non-resident under the Double Taxation Avoidance Agreement - the assessee shown, in its Profit and Loss Account, maintained in India, Audited as per Companies Act, income from services and other income amounting to Rs.21,04,600/- and Rs.2,78,026/- respectively - the AO was not justified in making addition of Rs.25,08,701/- Decided in the favour of the assessee Regarding depreciation - Exchange differences arising on repayment of liabilities -Held that: - Hon’ble Supreme Court in CIT vs. Maruti Udyog Ltd.(2009 -TMI - 34852 - SUPREME COURT) held that the Tribunal was right in holding that the claim for depreciation on account of enhanced cost of depreciation due to fluctuation in foreign exchange rate was admissible for deduction u/s.37 of the Income tax Act, 1961.
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