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2015 (1) TMI 1024 - HC - Income TaxExpenditure incurred for the expansion of existing business - Revenue v/s capital expenditure - Held that:- The amount which has never materialized, i.e. the expenses incurred towards such project is rightly treated as revenue expense and not as capital expenditure. - Decided in favour of the assessee. Exclusion of 90% of net interest for calculating the deduction under section 80HHC - Held that:- The question involved in the present appeal is governed by the decision of the Supreme Court in Distributors (Baroda) P. Ltd. v. Union of India and others [1985 (7) TMI 1 - SUPREME Court] and the deduction given under Section 80(c) is required to be upheld. Therefore, the tribunal has rightly directed exclusion of 90% of net interest for calculating the deduction under section 80HHC of the Income Tax Act, 1961. Income Tax Appellate Tribunal was right in law in allowing the expenditure of ₹ 32.05 lacs incurred on feasibility study of PET product. We also hold that the Income Tax Appellate Tribunal was right in law in directing the exclusion of 90% of net interest for calculating the deduction under section 80HHC of the Income Tax Act, 1961. - Decided in favour of the assessee.
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