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2015 (8) TMI 976 - AT - Income TaxWebsite development expenditure - Revenue v/s capital expenditure - Held that:- Undisputedly the Assessing Officer while treating the claimed Revenue expenditure as capital in nature has not examined properly as to whether the expenditure brought into existence any asset/s, or the usage period of the expenditure is of enduring nature. In absence of such verification by the Assessing Officer, we fully concur with the finding of the Learned CIT(Appeals) that the Assessing Officer was not justified in denying the claimed expenditure incurred on software/website development as Revenue expenditure. - Decided against revenue. Legal and professional consultancy expenditure - Revenue v/s capital expenditure - Held that:- This expenditure was held to be capital in nature by the Assessing Officer on the ground that the said expenditure was for development of website and the expenditure was of enduring nature. The submission of the assessee on the other hand remained that the expenditure was not for new project nor of enduring nature and it was incurred for the services rendered by the major consultant on day to day basis. In absence of rebuttal of these submissions of the assessee by the department, we are of the view that the Learned CIT(Appeals) has rightly treated the claimed expenditure as Revenue in nature on the basis that the Assessing Officer has treated the same as capital in nature without examining the material aspects of the claim as to whether the expenditure brought into existence any asset/s or the used period of the expenditure. - Decided against revenue. Computer repair/maintenance expenditure - Revenue v/s capital expenditure - Held that:-CIT(Appeals) has rightly deleted the disallowance with this finding that expenditure incurred on computer repair/maintenance are revenue in nature. The same is upheld.- Decided against revenue. Disallowance of deduction claimed u/s 36(1)(vii) on account of bad debts written off - CIT(A) deleted addition - Held that:- CIT(Appeals) has allowed the claimed deduction with this finding that after calling for the details required, if the Assessing Officer was satisfied that the amounts in question were offered for taxation in the earlier years and the accounts of the debtors were written off as claimed by the AR, no disallowance was called for. See TRF Ltd. vs. CIT (2010 (2) TMI 211 - SUPREME COURT) & Vijaya Bank vs. CIT [2010 (4) TMI 46 - SUPREME COURT ]. Under the facts, the issue is covered in favour of the assessee Disallowance of expenditure incurred on subscription fees paid to Internet Online Association - CIT(A) deleted addition - Held that:- The amount in question has been paid to Internet & Online Association Professional for subscription of web portal. Considering the nature of the business of the assessee, we are of the view that the Learned CIT(Appeals) has rightly treated the nature of the claimed expenditure as Revenue and has accordingly deleted the disallowance made by the Assessing Officer - Decided in favour of the assessee Disallowance of expenditure on marketing rights - holding the same to be prior period expenditure, hence, not allowable in the present year - Held that:- The authorities below have not disputed the genuineness of the above expenditure and their only finding is that the said expenditure pertains to previous assessment year i. E. 2004-05. We are of the view that when tax rate for the assessment years 2004-05 and 2005-06 is the same, the approach of the authorities below on the issue is not appreciable and it is also contrary to the established position of the law that year of crystallization of the liability is more important for the purpose of assessment of income in that year. We thus while setting aside the orders of the authorities below direct the Assessing Officer to allow the claimed expenditure during the year. - Decided in favour of the assessee
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