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2014 (5) TMI 83 - AT - Income TaxDeletion on account of depreciation of goodwill – Held that:- Since the issue about allowability of depreciation on goodwill as claimed by the assessee has been allowed by ITAT in a series of earlier years judgment and is also covered in CIT vs. Smifs Securities Ltd. [2012 (8) TMI 713 - SUPREME COURT] – Decided against Revenue. Disallowance of expenses u/s 14A of the Act – Held that:- AO has nowhere commented about this working being unsatisfactory or questionable - The addition has been made by summarily applying Rule 8D which was not applicable in this year - Thus, the assessee’s working remains unchallenged in effective terms - on merits also CIT(A) has merely made some further ad hoc estimate out of director’s remuneration, administrative expense and other heads - Thus, a partial addition has been sustained not on any cogent reasons but on ad hoc estimate - the addition deserves to be deleted on both counts i.e. non recording of satisfaction and on merits also - the partial addition u/s 14A retained by the CIT(A) is deleted. Leave encashment expenses – Held that:- There was merit in the contention of the assessee that the leave encashment though pertaining to earlier year is allowable on actual payment basis in the year of payment i.e. assessment year in question - It has not been disputed that assessee has not claimed the expenditure in earlier year - the assessee is eligible for deduction of leave encashment payment u/s 43B – Decided in favour of Assessee.
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