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2012 (8) TMI 397 - AT - Income TaxInterest from Head Office credited to the P&L Account - addition - Non-resident banking company - assessee contended the same to be non-taxable on ground that one cannot earn income from its own self - Held that:- Issue is covered in favor of assessee by decision of Special Bench in the case of Sumitomo Mitsul Banking Corpn. Vs. DDIT(IT)(2012 (4) TMI 80 - ITAT MUMBAI). Addition cannot be sustained - Decided in favor of assessee Bad debt - opening balance of the provision for bad debt was adjusted against the written off amount and remaining amount of bad debts was claimed - revenue was of the view that the assessee is entitled to a provision for bad debt u/s 36(1)(vii)(a) which is equal to 5% of the total income before deduction allowable under Chapter-VI - Held that:- Issue has been decided in favor of assessee in preceding years wherein it was held that if bad debts are written off in the books of account during the course of the previous year, such bad debts be deducted as admissible u/s 36(1)(vii) before quantifying the assessee’s total income for the purpose of clause (viia) - Decided in favor of assessee Head Office expenses viz traveling expenses claimed by assessee as deduction u/s 37 - Revenue contending application of Section 44C - Held that:- As the travelling expenses have been incurred by the head office on travel of its own staff and directly related to the business of the Indian Branch, hence we hold that section 44C is not applicable and these are allowable u/s 37(1) - Decided in favor of assessee Prior-period interest expenses - certain term deposit interest wrongly accrued on simple interest basis rather than on compound interest - additional interest claim during assessment proceedings - Revenue contending that deduction not made in the return cannot be entertained by AO otherwise than by filing a revised return - Held that:- Impugned amount claimed by the assessee is not a deduction but it is an expenditure. It is not the case of the revenue that these expenditures are not allowable in the regular course of business of the assessee. The claim is supported by the audit report. Therefore, we are of the opinion, that CIT(A) has rightly granted relief to the assessee - Decided in favor of assessee
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