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2015 (7) TMI 244 - AT - Income TaxAddition made u/s 2(22)(e) for deemed dividend - advance received from sister concern - CIT(A) deleted the addition - Held that:- We are not inclined to interfere in the order of ld. CIT(A) who has deleted the impugned addition of ₹ 58,12,248/- made u/s 2(22)(e) on account of advance received from sister concern. The assessee company does not hold a share in lender company from which it had received deposit then it cannot be treated to be a deemed dividend under section 2(22)(e) of the Act. It is an undisputed fact that assessee is not a shareholder of lender company, therefore, the deposit received by the assessee from said lender companies was an inter corporate deposit and not a deemed dividend, therefore, CIT(A) was justified in deleting the addition - Decided in favour of assessee. Disallowance of foreign travel expenditure - CIT(A) deleted the addition - Held that:- As decided in case of Jewel Consumer Care Pvt. Ltd. vs. ACIT [2010 (10) TMI 1013 - ITAT AHMEDABAD] from the facts of the case that the assessee submitted two reports which contained that the assessee visited Germany to negotiate supply of spares for the company’s machines and also understand certain technical issues related to the operations of the machines. In view of these facts, the assessee incurred this foreign traveling expenditure. We find no evidence that these tour expenditures are not for the purpose of the business rather it is for negotiating for spares and purchases of manufacturing machinery of tooth brushes, the visit was undertaken by the Managing Director. We find that the tour expenditure incurred by the assessee company was for the purpose of business wholly and exclusively. CIT(A) was justified in deleting the addition - Decided in favour of assessee. Addition of repairs for excavation of pond, purchase of wood shaft, ply, Burma teak wood, tiles etc. - revenue v/s capital expenditure - CIT(A) deleted the addition - Held that:- Some important principles have been culled out on the issue on the basis of various judicial pronouncements. An expenditure which involves mere replacement of a part of the machine and not the entire machine, or does not result in the creation of any new asset, cannot be termed as capital expenditure. Therefore, the impugned repair expenditure would amount to a revenue expense and it would qualify for deduction as repairs and maintenance. In view of this, we find no infirmity in the order of CIT(A).- Decided in favour of assessee. Deduction under section 80IA - CIT(A) allowed claim after considering the report of Chartered Engineer - Held that:- The issue is covered in favour of assessee by the decision of the Tribunal in assessee’s own case [2010 (11) TMI 935 - ITAT AHMEDABAD] and in the case of Baroda Precimould Pvt. Ltd. vs. ACIT [2010 (9) TMI 1053 - ITAT AHMEDABAD] wherein held the assessee must not be denied the claim of deduction under Section 80IA merely on this technical ground. We hereby direct the AO to allow the claim as per the law.- Decided in favour of assessee.
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