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2015 (2) TMI 637 - HC - Income TaxDisallowance of variable license fee - ITAT allowed the claim - Held that:- It is not disputed by counsel for the parties that the issue - as to whether such amounts are to be disallowed under Section 35ABB has now been answered against the Revenue by another Division Bench in CIT v. Bharti Hexacom Ltd.[2013 (12) TMI 1115 - DELHI HIGH COURT] - Decided in favour of assessee. Disallowance on account of interest on delayed payment to DoT (towards the license fee) - ITAT allowed the claim - Held that:- This Court notices that after recording as above in Bharti Hexacom [2013 (12) TMI 1115 - DELHI HIGH COURT], the matter was remitted to the Assessing Officer for working out the correct position. Accordingly, we direct the Assessing Officer to work out the correct position and determine whether the allowance claimed is to be capitalized or treated as revenue depending upon the payment period, i.e., before 31.7.1999 or subsequent to it. - Decided in favour of revenue for statistical purposes. Upfront fee and loans - initial determination of the AO was upset by the Tribunal which held that the fee is to be treated as revenue expenditure - Held that:- the issue is covered by the decision in Commissioner of Income Tax v. Gujarat Guardian Limited [2009 (1) TMI 13 - HIGH COURT DELHI]. This position was not disputed. Accordingly, the finding in the impugned order to this extent is upheld. - Decided against revenue. Pre-operative expenses - revenue v/s capital expenditure - Held that:- The very same issue stands covered by the decision of this Court in CIT v. Modi Industries Ltd.(1992 (10) TMI 74 - DELHI High Court). This has received further endorsement in judgments reported as CIT v. Monnet Industries (2008 (11) TMI 43 - HIGH COURT DELHI ) and CIT v. Relaxo Footwears (2007 (4) TMI 53 - HIGH COURT,DELHI ) thus to be held as revenue expenditure . - Decided in favour of assessee. Software expenditure - revenue v/s capital expenditure - Whether the ITAT was justified in the eyes of law in remitting the mater back to the file of the AO concerning the issue about the claim of the software expenses - Held that:- The question of law has to be answered in favour of the assessee treating the expenditure as revenue. See CIT v. Asahi India Safety Glass Ltd. [2011 (11) TMI 2 - DELHI HIGH COURT] . A direction remitting the matter for consideration, affirmed by the ITAT is accordingly set aside. - Decided in favour of assessee. Interest disallowance - AO disallow this amount as the assessee had borrowed amounts for the relevant assessment years, and was paying interest, but at the same time, had invested other amounts which were not yielding income - Held that:- In the present case, the CIT (A) and ITAT held that there was no nexus between the borrowing from the external sources/financial institutions - for which interest payments were made - and the investments made by the assessee in its subsidiaries. As relying on CIT, Delhi-I, New Delhi v. Bharti Televentures Ltd. [2011 (1) TMI 326 - DELHI HIGH COURT ] being the factual position reflected from the record of the assessee, the onus that laid on it stood discharged. - Decided in favour of assessee. Non adjudication of claim of expenditure made in the revised return - Held that:- The A.O. while finalizing the assessment u/s 143 (3) has incorrectly ignored/over looked the revised return filed by the appellant company within the stipulated period u/s 139 (5). In view of these facts the expenses of ₹ 14,05,886/- are held to be allowable as these were wrongly claimed by the appellant company in respect of A.Y. 2002-03 from where these expenses have been deleted and claimed in respect of A.Y. 2001-02 to which they pertain, by filing the revised return of income. Relief allowed ₹ 14,05,886/- - Decided in favour of assessee.
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