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2018 (12) TMI 207 - AT - Income TaxExemption under section 11 - disallowance made by AO on account of depreciation on fixed assets which the assessee had purchased and for which assessee had already availed benefit under section 11 - Held that:- CIT(A) has categorically noted in his order that assessee had not claimed exemption under section 11 when the assessee originally purchased fixed assets. He has further noted that depreciation was allowed to assessee in earlier years also and there was no change in facts and circumstances. He has further relied on a number of case laws for the proposition that depreciation is an allowable expense. Keeping all the issue of depreciation is decided in favour of the assessee. Sustenance of 50% of disallowance which the AO had made out of counseling expenses - Held that:- Expenditure to be an allowable expenditure but he just sustained the disallowance to the extent of 50% by holding that the same was sustained for want of proper verification. Other than this objection, there is no objection by the AO as well as the CIT(A). Simple ad-hoc disallowance is not sustainable in the eyes of law and therefore CIT(A) should have allowed full relief to the assessee and, therefore, we direct the AO to allow full claim of expenditure and in view of that cross objections filed by the assessee are allowed, and Revenue’s appeals on this account is also dismissed.
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