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2015 (10) TMI 2372 - AT - Income TaxClaiming the balance amount of discount also as expenditure of the year u/s 37(1) - Held that:- Hon’ble Supreme Court in the case of Madras Industrial Investment Corporation Vs. CIT [1997 (4) TMI 5 - SUPREME Court], which is directly applicable to the facts of the case as considered by the Ld. CIT(A). Moreover, the judgment in the case of Taparia Tools Limited Vs. JCIT, Nasik (2015 (3) TMI 853 - SUPREME COURT) is under the provisions of Section 36(1)(iii) whereas the decision of the Hon’ble Supreme Court in the case of Madras Industrial Investment Corporation Vs. CIT [1997 (4) TMI 5 - SUPREME Court] is directly U/s. 37(1) and that too on the issue of discount on debentures. Since there is a direct judgment of the Hon’ble Supreme Court covering the facts of the case, we do not see any reason to interfere the order of the Ld. CIT(A). This is also in tune with the claim of ‘premium’ considered in later grounds, principles being same. Accordingly, we uphold the spreading over of the discount on debentures over period of debentures i.e., five years. Accordingly, we uphold the allowance of 1/5th of the discount only in the year under consideration - Decided against assessee. Issue of claim of ‘premium’ which was disallowed U/s. 40(a)(ia) - Held that:- Even if the amount is credited to Suspense A/c, but is claimed in the Books of Accounts of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of payee and the provisions of this Section shall apply accordingly. There is no dispute that assessee has provided the amount in the Books of Accounts and also claimed in the P&L A/c as an expenditure. Consequently, the credit of such in books of account shall be deemed to be income to the account of payee and provisions of Section 194A do apply to the facts of present case. Consequently, for the failure of deduction of tax at source, we are of the opinion that amount is disallowable under the provisions of Section 40(a)(ia). - Decided against assessee.
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