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2018 (9) TMI 769 - AT - Income TaxDisallowance of expenses for purchase of application software - nature of expenditure - revenue or capital expenditure - Held that:- If the revenue expenditure has been incurred in a particular year then same has to be allowed in that year itself, if the assessee has claimed the expenditure in that year and Revenue cannot deny the same. Thus, in view of earlier year precedence in assessee’s own case [2016 (6) TMI 1240 - ITAT DELHI] and also respectfully following the ratio laid down by the Hon'ble Apex Court in the case of Taparia Tools Ltd [2015 (3) TMI 853 - SUPREME COURT], we decide this issue in favour of the assessee Addition u/s 14A - Held that:- AO should have first examined such a claim with regard to the accounts of the assessee and the nature of expenditure debited so as to prima-facie come to a satisfaction whether any expense can be attributed for the purpose of earning the exempt income. It is only when he finds certain discrepancies in assessee’s claim, then only he can proceed with making of the disallowance. Here in this case, as discussed above, no such satisfaction has been recorded, and therefore, we hold that no disallowance u/s.14A should be made. The other plea taken by the parties before us, are not discussed, because at the threshold we have held that no disallowance should be made. Income on account of reversal of income as per RBI guide lines - Held that:- this issue has been discussed by the Tribunal in assessee’s own case for the Assessment Year 1999-00 in the case of its sister concern which has been confirmed by the Hon'ble Delhi High Court also. The ld. CIT (A) has held that since the issue is now settled by the Hon'ble Jurisdictional High Court in the case of the assessee and on the similar facts, he deleted the addition. - Revenue appeal dismissed.
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