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2012 (8) TMI 113 - ITAT HYDERABADAllowability of bank guarantee commission – Held that:- Bank guarantee has been given on behalf of the assessee - commission paid by the assessee to the guarantor for enabling it (the assessee) to make deferred payment of the purchase consideration, constitutes revenue expenditure and not capital expenditure and, therefore, is admissible as deduction from the income - bank guarantee on behalf of the assessee by M/s. PCL has to be verified and decided accordingly Disallowance of interest expenditure on secured loans - Assessing officer opined that there was no evidence to the effect that the assessee had paid any tax or made TDS thereon – Held that:- No payment has gone out of the assessee company and THDC itself deducted the amount towards the interest. It is being a joint venture of Government of India and Government of U.P. - there is no question of deducting the TDS on the impugned interest amount - THDC falls under the purview of section 194A(3)(iii)(f) of the Income-tax Act, 1961 and as such it is not liable for deducting TDS - ground of the assessee is allowed Ad-hoc disallowance – disallowance is made on ad-hoc basis as the expenditure is not properly supported by vouchers – Held that:- Ad-hoc disallowance at Rs. 15 lakhs is on higher side - Assessing Officer directed to disallow only 5% of the cash expenses unvouched by proper bills and receipts if it is not a statutory payment since there are chances of inflating the cash expenses. This ground is partly allowed. Disallowance of legal charges on account of non TDS - assessee submitted that each payment is less than Rs. 20,000 on various dates and provisions of section 40(a)(ia) are not applicable – Held that:- Whether the payments are less than Rs. 20,000 is required to be examined by the Assessing Officer - matter Assessing Officer - ground is allowed for statistical purposes - appeal of the assessee is partly allowed.
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