Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (8) TMI 322 - AT - Income TaxDisallowance u/s. 14A r.w.Rule 8D - CIT(A) deleted addition - Held that:- The disallowance has been made by the AO by applying Rule 8D, however, the assessment year under consideration is 2007-08 in which Rule 8D is not applicable but disallowance is to be made on reasonable basis. After giving detailed finding with regard to availability of own funds and interest free funds, the CIT(A) deleted the disallowance on account of interest. However, with respect to administrative expenses, the CIT(A) also applied Rule 8D and computed the same at ₹ 3,65,707/-. We found that the dividend income received by the assessee during the year was ₹ 4,86,684/-, since the relevant assessment year is 2007-08, wherein Rule 8D is not applicable, keeping in view various judicial pronouncements cited at Bar by the ld. AR, we direct the AO to restrict the disallowance to the extent of 10% of the dividend income - Decided partly in favour of assessee. Disallowance of penalty levied by the Stock Exchange - CIT(A) deleted addition - Held that:- We have considered rival contentions and found that exactly similar issue is covered by the order of the Tribunal in assessee’s own case as mentioned by the CIT(A) in his appellate order wherein held that the expenses are in the nature of payments towards violating the prescribed rules/ regulation, short /partial collection of margins, non-maintenance of complete records, delay in payout of funds and securities, incomplete KYC forms, etc which are mere breach of contractual liability and adhere to proper procedure and not for infringement or infraction of any statutory law, therefore not hit by explanation to section 37(1) of the Act. Respectfully following the same, we do not find any infirmity in the order of CIT(A) for deleting the disallowance of penalty alleged to be paid to stock exchange. - Decided in favour of assessee. Disallowance of software expenses - CIT(A) deleted addition - Held that:- CIT(A) after following the order of ITAT Special Bench in case of Amway India Enterprises [2008 (2) TMI 454 - ITAT DELHI-C ], directed the AO to allow Annual maintenance charges as revenue expenditure and allow deduction of the same and treat the software expenditure as capital in nature. No infirmity in the order of CIT(A).- Decided in favour of assessee. Disallowance of club membership fees - CIT(A) deleted addition - Held that:- The issue under consideration is covered by the decision of the Hon’ble jurisdictional High Court in the case of Otis & Lubrizol India Ltd., [2015 (8) TMI 134 - BOMBAY HIGH COURT]. The finding recorded by the CIT(A) has not been controverted. Respectfully following the decision of the jurisdictional High Court in the case referred above, we do not find any infirmity in the order of CIT(A).- Decided in favour of assessee. Disallowance of sundry balance written off - CIT(A) deleted addition - Held that:-Assessee has claimed deduction on account of bad debts which arose in the course of its business of brokerage. As the amount could not be recovered from the clients, who defaulted in payments, the assessee has accounted for the said brokerage income in its books, therefore, debt was incurred as a normal incidence of business. There is no reason to disallow the same even as business loss. The finding recorded by the CIT(A) has not been controverted. Accordingly, we do not find any infirmity in the order of CIT(A) for deleting the disallowance.- Decided in favour of assessee.
|