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2017 (10) TMI 1399 - AT - Income TaxDisallowance made u/s 14A - Held that:- AO is directed to apply this proposition of law as laid down in the above decision to the facts of this case and determine the disallowance under Rule 8D2(ii) of the Rules. The claim of the assessee that it has made strategic investments and that these investments should not be considered while computing disallowance under Rule 8D2(ii) of the Rules, has also to be adjudicted by the Assessing Officer. The Hon’ble Special Bench of the ITAT in the case of ACIT vs. Vireet Investment Pvt Ltd.[2017 (6) TMI 1124 - ITAT DELHI] held that only those investments are to be considered for computing the average value of investment which yielded exempt income during the year. The Assessing Officer is directed to apply this proposition of law and work out the disallowance, if any, under Rule 8D2(ii) of the Act. Accordingly, this ground of the assessee is allowed for statistical purposes. Disallowance of the provisions for leave encashment - Held that:- We find that the Kolkata ‘A’ Bench of the Tribunal in the assessee’s own case for the Assessment Year 2007-08, while adjudicating the same issue remitted the issue to the file of the Assessing Officer to decide the same taking into consideration the outcome of the case in M/S EXIDE INDUSTRIES LTD. & ANR. [2009 (5) TMI 894 - SUPREME COURT]. Deduction u/s 10B - Held that:- We find that the Tribunal in the assessee’s own case on the very same issue for the Assessment Year 2004-05 up to Assessment Year 2008-09, has adjudicated the issue in favour of the assessee. It was held that rent realized from staff, insurance claim realized in respect of damage of goods, excess liability from sundry creditors written back, for revenue expenses and miscellaneous incomes and receipts including duty draw back have to be treated as income from business and have to be considered while calculating deduction u/s 10B. Provision for market to market losses to be allowed as relying on assessee's own case.
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