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2014 (12) TMI 525 - HC - Income TaxAllowability of deduction on rent, repairs and depreciation and other expenses on guest house u/s 37(4) – Held that:- Following the decision in Britannia Industries Ltd. v. Commissioner of Income-Tax and Another, [2005 (10) TMI 30 - SUPREME Court] wherein it has been held that while the expression "premises and buildings" in sections 30 and 32 and the expression "residential accommodation including any accommodation in the nature of guest house" in sub-sections (3), (4) and (5) of section 37 can be similarly interpreted, a distinction has been sought to be introduced for the purpose of section 37 by specifying the nature of the building to be a guest house - the intention was to excluded from deduction the expenses towards rents, repairs and also maintenance of premises / accommodation used for the purpose of a guest house of the nature indicated in subsection (4) of section 37 – Decided in favour of revenue. Expenses incurred on issue of debentures – revenue expenses or not – Held that:- Following the decision in INCOME TAX OFFICER Versus VXL INDIA LIMITED [2009 (7) TMI 1205 - GUJARAT HIGH COURT] - when the debentures are converted into equity shares, the assessing company has already got enduring benefit and the expenditure incurred by the conversion of equity shares has to be treated as capital expenditure -portion of the convertible debenture was converted into equity shares and assessee company had got enduring benefits – the Assessing Authority disallowed expenditure only to the extent pertaining to the convertible portion of the expenditure which formed part of the capital – the order of the Tribunal is upheld – Decided against revenue.
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