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2012 (12) TMI 414 - AT - Income TaxTaxation of interest received from head office - Held that:- Interest income of Rs. 5.61 crore which has resulted only from the assessee's dealings with its Head office cannot be charged to tax on the principle of mutuality. Accordingly no tax can be levied on the interest earned by the assessee from its Head office or overseas branches. At the same time the principle of mutuality will extend equally in respect of interest paid by the assessee to its head office or other overseas branches. The assessee cannot claim deduction in respect of interest paid to its head office and overseas branches. The Assessing Officer is directed to allow exemption in respect of interest income and also not to grant any deduction in respect of interest expenditure. Deduction u/s 44C - specific expenses incurred by head office on behalf of Indian branch in revised return u/s 37 - Held that:- When the assessee revised its return and claimed deduction u/s 44C at higher level than that claimed in the original return, it was the duty of the AO to consider the higher claim u/s 44C and not to restrict himself to the claim made in original return - no absurdity in the direction of CIT(A) to AO to consider deduction u/s 44C on the basis of revised return subject to verification of the correctness of the revised return. Therefore, upholding the impugned order on this issue except for the removal of the last sentence from para 6.1., which is contrary to his conclusion on the point - the assessee's ground is accepted to the extent of the removal of the last sentence. Disallowance u/s 43B - employer's contribution to provident fund not paid before the due date under the EPF Act - CIT(A) sustained the disallowance accordingly - Held that:- No disallowance can be made if the employer's contribution or the employees' contribution is paid before the due date of filing return of income as per sec 139(1) as decided in CIT v. Alom Extrusions Ltd. [2009 (11) TMI 27 - SUPREME COURT ] read along with CIT v. AIMIL Ltd. [2009 (12) TMI 38 - DELHI HIGH COURT]- in favour of assessee. Deduction on account of bad debt written off - disallowance as the assessee could not prove that the amount had become bad in the year - Held that:- As decided in T.R.F. Ltd. v. CIT [2010 (2) TMI 211 - SUPREME COURT] & DIT (International taxation) v. Oman International Bank [2009 (2) TMI 54 - BOMBAY HIGH COURT] deduction of bad debt is allowable on a simple write off and it is not for the assessee to prove that the debt had become bad - in favour of assessee. Non deduction of TDS - paid transaction charges on NOSTRO account with banks outside India - Disallowance u/s 40(a)(i) - Held that:- As decided by the Tribunal in earlier years in assessee's favour. Respectfully following the same, we uphold the impugned order on this issue. This ground is not allowed.
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