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2013 (10) TMI 459 - AT - Income TaxDisallowance of various expenditure - expenses have been mainly disallowed on the ground that these were not commensurate with the income earned - Held that:- This approach is however not legally tenable. Expenses incurred for the purpose of business have to be allowed even if there is no income earned or there is loss in the business. - Decided in favor of assessee. Claim of interest expenses related to earlier years - Held that:- The amount written off of ₹ 5,06,789/- was on account of interest payable to IL&FS, the interest had been paid by the assessee in the earlier years but was not claimed as deduction due to dispute with IL&FS. CIT(A) has given a clear finding that the dispute has been settled in assessment year 2008-09 and, therefore, the claim was allowable in this year. - Decided in favor of assessee. Book adjustments u/s 115JB - MAT - Whether the statutory disallowance made as per Rule 8D of section 14A in relation to exempt income can be added while computing the book profit - Adjustment to be made to the book profit in terms of Explanation 1(f) of section 115JB – Held that:- Relying upon the judgment in the case of Goetze (India) Ltd. v. Commissioner of Income-tax [2009 (5) TMI 615 - ITAT DELHI], it has been held that provisions of section 14A could not be imported into clause (f) to Explanation 1 to the section 115JB while computing book profit. It was also held that only the expenditure incurred in relation to exempt income and debited to P&L account can be added while computing the book profit – Decided against the Revenue.
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