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2013 (8) TMI 300 - HC - Income TaxDisallowance of depreciation - Assets leased to Western Railways - transactions of lease were questioned by the Assessing Officer - Held that:- it is not a case, as is appearing from different clauses of the lease deed that the equipments leased will be returned back to the lessor after the expiry of the lease. Nothing has been brought to disapprove the said clauses of the lease deed by any of the authorities below - It is not proved that assessee is only a financer and is not interested in the assets and therefore, it cannot be said as full payout lease - such claim did not arise for consideration for the first time, but, is spread over to the entire period between A.Y. 1996-97 to 1999-2000. Such claim was made by the Assessee and duly granted by the Assessing Officer - Decided against Revenue. Premium on redemption of debentures - Tribunal allowed deduction - Held that:- where the company undertakes to pay more amount than what it has borrowed, and liability to pay the excess amount undertaken to be paid by the company to fulfill its needs for borrowed money is an allowable expenditure under section 37 of the Income Tax Act - Following decision of Madras Industrial Investment Corporation Limited v. Commissioner of Income Tax [1997 (4) TMI 5 - SUPREME Court] - Decided against Revenue. Deduction on restructuring of the term loan - Tribunal allowed deduction - Held that:- act of borrowing money was incidental to carrying on of the business, the loan obtained was not an asset or an advantage of enduring nature, the expenditure so made for securing the use of money for a certain period and it was irrelevant to consider the object with which the loan was obtained. Thus, when obtaining of a loan is not considered as an asset or an advantage of enduring nature, any expenditure incurred for reducing such loan burden or securing the borrowings, on more advantageous condition, can not be seen as resulting into a benefit of enduring nature so as to be categorized as a capital expenditure - Following decision of India Cements Limited v. Commissioner of Income Tax, Madras [1965 (12) TMI 22 - SUPREME Court] - Decided against Revenue. Deduction u/s 36[1](iii) - Held that:- Department had allowed such deduction in the earlier years - when it was found that the machinery being purchased through borrowed funds was not for the purpose of new business but expansion of the existing business claim of interest was rightly held allowable - Decided against Revenue.
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