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2015 (1) TMI 613 - HC - Income TaxDeduction under Section 80HHC - ITAT allowed the claim of the assessee for 10% of the expenditure relating to indirect cost for computing deduction - Held that:- under section 80HHC(3)(b) one has to balance the "principle of attribution" with the concept of "allocation". The concept of allocation is meant to reduce the incentive. However, when "allocation" has to be balanced with the "principle of attribution", the object is to reduce the incentive and not to eliminate it. The question of law raised in this appeal is thus answered in favour of the assessee and against the revenue. Accordingly, we hold that the Tribunal was right in law in allowing the claim of the assessee for 10% of the expenditure relating to indirect cost for computing deduction under Section 80HHC. - Decided in favour of assessee. Penalty u/s 271(1)(c) - addition made in the quantum proceedings - Held that:- As the said addition was subsequently deleted by the Tribunal in ITA No.45/Ahd/2005. Since the penalty was a consequential action of the addition made, the same would not survive when the addition itself has been deleted by the Tribunal.Tribunal was right in cancelling the order of penalty imposed on the assessee. - Decided in favour of assessee.
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