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2011 (5) TMI 653 - AT - Income TaxDis-allowance of provision made for obsolete stores/ spares – Held that:- Such loss cannot be claimed in any year rather it can be claimed only in the year in which such items are actually sold and disposed off. Decided against the assessee. Dis-allowance of expenditure in relation to dividend income(exempt) – Held that:- The assessee themselves have disallowed a part of the expenses. The Assessing officer should examine whether this disallowance offered by the Assessee themselves is reasonable and if not explain why it is not so. In this view of the matter it is remitted back to the file of the AO to rework the disallowance u/s 14A on a reasonable manner. Partly allowed in favor of assessee for statistical purposes. Prior period expenses - expenses pertained to discount crystallized during the year – Held that:- Where the deduction is obviously a permissible deduction then the department should not dispute as to the year in which deduction should be allowed. The issue is covered in favour of assessee by the decision of the Tribunal in assessee’s own case for the earlier A.Y.s Depreciation on ERP software – Held that:- Computers including Computer software is entitled to depreciation at 60%. It cannot be considered as intangible assets eligible for depreciation @25%. Decided in favor of the assessee. Amount transferred from special reserve and set off against the depreciation in the Books – Held that:- The assessee followed the accounting practice of transferring proportionate amount from this Special Reserve and setting off of book depreciation for several years .The set off of special reserve against book depreciation donot affect the income. Also as the amount was received in 1992 therefore the same cannot be treated income of assessee in this year. This was only a mere book entry which was set off against depreciation. Decided in favor of the assessee. Additional depreciation on new plant and machinery installed. – Held that:- Grant of depreciation and additional depreciation is mandatory, whether claimed by the Assessee or not. Omission to claim depreciation in the return, will not disentitled the assessee to claim additional depreciation to which they are statutorily entitled to. Decided in favor of the assessee.
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