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2016 (7) TMI 758 - AT - Income TaxTDS u/s 195 - Disallowance made under section 40(a)(I) - expenditure incurred on subscription paid to nonresidents abroad - Held that:- The authorities below have not checked with the invoices submitted by the assessee as to whether the services rendered by the non-residents are in the nature of fee for technical services or pure business transactions. Under the above facts and circumstances, we set aside the order passed by the ld. CIT(A) and remit the matter to the file of the Assessing Officer to verify the nature of services rendered by the non-residents and decide the issue afresh in accordance with law after allowing opportunity of hearing to the assessee. - Decided in favour of revenue for statistical purposes. Disallowance of the claim of deduction towards software purchases - revenue or capital expenditure - Held that:- The test of enduring benefit is not certain or conclusive test in determining the expenditure as capital or revenue. The real intent of the expenditure and whether the expenditure results in creation of fixed capital for the assessee are to be examined. Thus, in view of the ratio laid down by the Hon’ble Delhi High Court in the case of CIT v. Asahi India Safety Glass Ltd.(2011 (11) TMI 2 - DELHI HIGH COURT ), we hold that the software expenses should be treated as revenue in nature and accordingly, we set aside the order of the ld. CIT(A) and direct the Assessing Officer to delete the disallowance made on this account. - Decided in favour of assessee. Disallowance of the claim of depreciation at 60% for UPS attached to computers (restricted to 15%) - Held that:- We direct the Assessing Officer to allow 60% depreciation on UPS. See DCIT v. Indian Bank [2016 (7) TMI 728 - ITAT CHENNAI] TDS u/s 194J - expenses incurred on website development - non-deduction of TDS - Held that:- Website development is nothing but creation of new asset and the entire expenditure was incurred for the future of the company and also for a long term impact, which is of enjoying enduring benefit. Therefore, we find no infirmity in the order passed by the ld. CIT(A). - Decided against assessee.
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