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2014 (2) TMI 672 - AT - Income TaxDisallowance of depreciation – Held that:- The decision in Deputy Commissioner of Income Tax, Circle-11 (1), New Delhi. Versus M/s Escorts Finance Ltd. [2012 (9) TMI 473 - ITAT, DELHI] followed -assessee was claiming depreciation on old vehicles only which were already let out on hire and on which the assessee had already been allowed depreciation @ 40% - vehicles owned by a non-banking finance company leased to third party are eligible for higher rate of depreciation @ 40% - thus, the assessee was rightly eligible for depreciation at higher rate – Decided in favour of Assessee. Treatment of capital loss – Speculation loss as per Explanation to Section 73 of the IT Act OR not – Held that:- The decision in Deputy Commissioner of Income Tax, Circle-11 (1), New Delhi. Versus M/s Escorts Finance Ltd. [2012 (9) TMI 473 - ITAT, DELHI] followed - Explanation to Section 73 does not apply to investments in Govt. Securities, and also the fact recorded by the CIT (A) that the assessee is not in the business of trading in share and has incurred a loss on its investment - the actions of the AO in invoking Explanation to Section 73 is wrong – Decided against Revenue. Disallowance u/s 14A of the Act – Held that:- The decision in Maxopp Investment Ltd. & Others Versus Commissioner of Income Tax [2011 (11) TMI 267 - Delhi High Court] followed – the matter remitted back and the AO is directed for fresh adjudication – Decided in favour of Revenue. Deletion made on account of reversal of income charged to P&L A/c – Held that:- The assessee has recognized the income in the earlier assessment years - it is not the case of recognizing current year income - the parties accounts would have been debited, increasing the balance in the debtor account to the extent of interest accrued but not received - Reversal of such income, which is already accounted as income in the earlier assessment year would be possible only by, part write off the debts - The accounting entries and treatment in the books have to be considered and it has to be seen whether there is part write off of debts in the books of accounts - Verification of facts is required – Matter remitted back to the AO for fresh adjudication – Decided in favour of Revenue. Disallowances of calculation of book profit u/s 115JB of the Act – Held that:- The assessee company while preparing the computation of income added back the provision - In the current A.Y. 2008-09 a part of this provision for doubtful advances was written back to the profit & loss a/c on the ground that the provision in question is no longer required - Such withdrawal from the reserve of a provision has to be deducted while computing book profits u/s 115 JB of the IT Act, as per the Section - there was no infirmity in the order of the first appellate authority – Decided against Revenue.
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