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2014 (6) TMI 146 - AT - Income TaxTaxing of interest received on application money Purchase of tax free bonds Held that:- Following CIT vs. Bharat Heavy Electricals Ltd.[2012 (9) TMI 515 - DELHI HIGH COURT] - interest for the brief period between the date of application and allotment of bonds could not be taxed Revenue could not bring any contrary fact or case law Decided in favour of Assessee. Disallowance of foreign exchange fluctuation loss - Revenue expenditure or not - Disallowance of investment allowance on increase in liability on account of foreign exchange fluctuation loss Expenses on AGM of shareholders Disallowance of guest house expenses u/s 37(4) of the Act Held that:- Following M/s. Tata Chemicals Ltd. Versus The DCIT, Special Range-1, Mumbai [2014 (5) TMI 956 - ITAT MUMBAI] - the assessee has been allowed depreciation on foreign exchange fluctuation loss thus, the AO is directed to allow depreciation as per law also the AO is directed to allow the investment allowance on exchange loss treated as capital expenditure thus, the matter is remitted back to the AO Decided in favour of Assessee. Expenses on issue of debentures and bonds Held that:- Following M/s. Tata Chemicals Ltd. Versus The DCIT, Special Range-1, Mumbai[2014 (5) TMI 956 - ITAT MUMBAI] - the Tribunal has allowed the debenture expenses thus, the AO is directed to allow the expenses on issue of debenture Decided in favour of assessee. Disallowance of sundry contributors u/s 40A(9) of the Act Staff welfare expenses Held that:- As it has been already decided by the Tribunal in the earlier assessment years, the AO is directed to allow the expenses - So far the payments to schools (staff welfare expenses) is concerned, the matter is remitted back to the AO for adjudication Decided in favour of Assessee. Family planning expenses Held that:- Following Atlas Cycle Industries Ltd. [1980 (3) TMI 43 - PUNJAB AND HARYANA High Court] - the disallowance of 50% made by the Income Tax Authorities for such type of expenditures incurred on an Eye Camp for the workers of the assessee company is upheld - The 50% of the expenditure was disallowed in the case on the ground that the benefit was also derived by the outsiders - thus, the disallowance on the issue is restricted to 50% of the expenditure incurred Decided partly in favour of Assessee. Interest of advance to subsidiary companies Held that:- The Commissioner of Income Tax Versus Reliance Utilities & Power Ltd. [2009 (1) TMI 4 - HIGH COURT BOMBAY] the AO is directed to decide the issue as per the decision Decided in favour of Assessee. Disallowance of extra shift depreciation Various additions on plant and machinery Held that:- Following M/s. Tata Chemicals Ltd. Versus The DCIT, Special Range-1, Mumbai[2014 (5) TMI 956 - ITAT MUMBAI] - the Tribunal has restored back the issue to the files of the AO to consider the claim of the assessee after taking into consideration the I.T. Rule-5 of 1984-85 thus, the AO is directed to decide the issue afresh Decided in favour of Assessee. Disallowance of investment allowance Disallowance of investment allowance on increase in liability on account of foreign exchange fluctuation loss - Held that:- Tata Chemicals Limited Versus The ACIT Cir 2(2), Mumbai & Others [2012 (10) TMI 46 - ITAT MUMBAI] - the disallowance of investment allowance on certain items treated in the nature of civil work and not integral part of the plant and machinery there was merit in the contention of the assessee that the Tribunal on the similar issue has upheld the order of the CIT(A) who set aside the issue to the file of the AO thus, the matter is remitted back to the AO for fresh adjudication Decided partly in favour of Assessee. Disallowance u/s 43B of the Act Royalty on limestone and mineral rights tax - Held that:- The AO has disallowed Royalty of Limestone following the assessment - the Tribunal has restored back the issue to the file of the AO to verify the payment and allow deduction as per law if the payments have already been made this, as far as royalty of limestone is concerned, the matter is remitted back to the AO for verification of the payments as per the provisions of Sec. 43B - So far the disallowance relating to mineral rights tax is concerned - the assessee has retained the money from the suppliers on the pretext that it will make the payment to the Government - as the assessee itself has agreed to pay the MRT on the limestone purchased by it and as it has not discharged the liability till the end of the accounting year, there was no reason to interfere in the order of the CIT(A) Decided against Assessee. Employees entertainment expenses u/s 37(2) r.w. Explanation III - Subsidized lunch coupons Payments made to Tata Services Ltd. incentive bonus to workers - Held that:- As decided in assessees own case for the earlier assessment year, it has been already decided in favour of assessee thus, there is no need for interference Decided against Revenue.
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