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2017 (7) TMI 606 - AT - Income TaxTDS U/S 194J - internet services, i.e. leased line benefits/broadband services - whether in the nature of technical services - TDS liability - Held that:- The expenditure in question incurred by the assessee are in respect of internet charges and communication and service charge paid to three companies. There is no dispute that the payment for uses of internet of the width cannot be considered as Fees for Technical Services in view of the decision of Hon'ble High Court in the case of CIT Vs. Estel Communcations Pvt. Ltd. (2008 (3) TMI 327 - DELHI HIGH COURT ), we do not find any error or illegality in the order of the impugned order of CIT (Appeals) on this issue. Addition made under Section 41(1) - Held that:- The assessee has claimed that this amount was capitalized in the books of account and therefore no claim was made by the assessee as an expenditure in respect of this amount. However this fact was not pointed out before the Assessing Officer and therefore in the absence of verification of the relevant record regarding the fact that the assessee has not claimed this amount in the computation of income in any of the earlier years in our opinion the CIT (Appeals) should have asked a remand report from the Assessing Officer before giving the finding on this issue. Accordingly, in the facts and circumstances of the case and in the interest of justice we remit this issue to the record of the Assessing Officer for limited purpose of verifying the fact as to whether this amount was capitalized by the assessee and not claimed as an expenditure. Disallowance u/s 40(a)(ia) - depreciation on Intellectual Property Rights (‘IPR’) - Held that:- As regards the applicability of the provisions of Section 40(a)(ia) of the Act for disallowance of claim of depreciation, we find that when the assessee has capitalised this amount and not claimed as a revenue expenditure then the claim of depreciation cannot be disallowed by invoking the provisions of Section 40(a)(ia) of the Act.
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