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2018 (5) TMI 940 - AT - Income TaxDisallowing the claim of weighted deduction u/s.35(2AB) - approval by prescribed authority - Held that:- We direct the Assessing Officer to grant deduction under section 35(2AB), as, beyond any dispute or controversy, the R&D Unit is approved by the prescribed authority, and as the date of approval, in the light of the above discussions, is not really material for the present purposes. The disallowance thus stands deleted. - Decided in favour of assessee. Disallowing reimbursement of advertisement expense u/s.40(a)(ia) - non deduction of tds - Held that:- Quite clearly, reimbursements of expenses do not require tax deduction at source. The tax deduction liability arises only at the point of time when payment is “for carrying out any work in pursuance of a contract” for the specified purposes. The payment, in the present case, is not for carrying out any work of the specified nature but only a partial reimbursement of such a payment of specified nature. The distinction is subtle and significant. The lower authorities clearly lost sight of the above aspect of the matter, and proceeded to treat reimbursement of expenses as incurring of expenses. Disallowance to be deleted - Decided in favour of assessee.
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