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2017 (6) TMI 244 - AT - Income TaxDisallowance of claim for deduction being the provision for warranty quantified at 2% of the total sales in the computation of taxable total income - Held that:- In our opinion, the warranty based on the actionable basis or scientific basis, it is to be allowed. This fact was not demonstrated by the assessee before the Ld.CIT(A). If the methodology followed to make such warranty provisions in the books of accounts is on notional basis, then notional provisions cannot be allowed. The assessee is duty bound to explain the basis on which it was provided in the books of accounts of the assessee. Accordingly, the issue in dispute is remitted to the file of ld. Assessing Officer for fresh consideration. Disallowance of foreign exchange fluctuation loss - Held that:- In our opinion, the loss incurred by the assessee on account of foreign exchange fluctuation is arisen on depositing of export proceeds in EEFC account based on RBI guidelines. Being so, the loss on this count to be allowed as a revenue loss in view of the judgment of Supreme Court in the case of Woodward Governor India (P) Ltd. in [2009 (4) TMI 4 - SUPREME COURT]. Accordingly, this ground of assessee is allowed TDS u/s 195 - Disallowance u/s.40(a)(i)- commission paid without deducting TDS - Held that:- A similar issue came for consideration before this Tribunal in assessee's own case for assessment year 2008-09 as held that the non-resident agent did not provide technical services for the purposes of running of the business of the assessee in India. Therefore, the commission paid to the nonresident agents would not fall within the definition of “fees for technical services” and the assessee was not liable to deduct tax at source on payment of commission. - Decided in favour of assessee Addition on account of retention money - Held that:- As decided in CIT vs East Coast Constructions and Ind. Ltd, [2006 (1) TMI 77 - MADRAS High Court] the assessee was entitled to receive the retention money after completion of the contract. On the date of the bills, no enforceable liability had accrued or arisen. When the assessee had no right to receive the money by virtue of the contract between the parties and the assessee also had no right to enforce payment, it could not be said that the right to receive payment of the remaining 10 per cent of the value of job had accrued - Decided in favour of assessee Addition made towards forfeited trade advances - Held that:- CIT(A) deleted the addition without calling for a remand report from the AO and the submissions of the assessee is not at all verified by the AO. Hence, this issue in dispute is remitted to the file of AO for fresh consideration.
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