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2010 (12) TMI 582 - AT - Income TaxDisallowing u/s.14A - the decision of the jurisdictional High Court in the case of Godrej and Boyce Mfg. Ltd. vs. DCIT (2010) 328 ITR 81 (Bom.), Rule 8D, being held to be prospective, could not be invoked in the relevant assessment year and, therefore, the matter needs to be restored back to the file of AO for deciding the issue de novo - direct accordingly. In the result, this ground is allowed for statistical purposes. Disallowance u/s.40(a)(ia) - Labour charges for manufacturing the asset - Revenue or capital expenditure - The Tribunal, after considering the submissions of both the parties, inter alia, concluded that the payment made for purchase of software could not be treated either as royalty or even for technical services. Therefore, the payment for SAP software could not be charged to tax in India as interest or royalty or fee for technical services. The Tribunal concluded that the payment made for acquisition of an asset, whether it is a revenue expenditure or capital, the provisions of sec. 40(a)(i) of the Act will not be applicable in respect of the respondent assessee for asstt. year 2000-01. However, in the present case, the applicability of sec. 40(a)(ia) has not been ruled out and, therefore, to the extent the assessee had made claim of depreciation in the P and L a/c., the same is to be disallowed - direct accordingly. In the result, this ground is dismissed. Disallowance on account of chit funds - deciding this issue, the AO will take into consideration the decision of Hon'ble Supreme Court reported in 124 ITR 1 - In the result, this ground is allowed for statistical purpose.
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