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2019 (12) TMI 213 - AT - Income TaxDisallowance u/s 14A r.w.r 8D - business of running a stock exchange - interest on tax free bonds and dividend income - assessee made suo moto disallowance of expenses u/s 14A of the Act computed at 0.1% of exempted income as expenditure attributable to earning of tax free income - Held that:- the year under consideration is Asst Year 2007-08, for which year, the computation mechanism provided in Rule 8D(2) of the Rules cannot be made applicable as it was introduced only with effect from 24.3.2008 relevant to Asst Year 2008-09 and was held to be prospective in operation - AO directed to disallow 1% of exempt income and work out the disallowance u/s 14A of the Act accordingly after reducing the amount already disallowed by the assessee in the return of income. - Decided partly in favor of assessee. Disallowance of proportionate amortized amount of lease premium paid to Bombay Metropolitan Regional Development Authority in respect of leasehold land - Capital or Revenue nature - Held that:- Matter restored before the AO for deciding the issue in the light of decision of Hon’ble Gujarat High Court in the case of Sun Pharmaceuticals India Ltd [2009 (3) TMI 587 - GUJARAT HIGH COURT] Disallowance of lease premium being included in the maintenance expenses - Held that:- Since the issue of disallowance of lease amortization premium of ₹ 1,29,52,157/- has been restored back to the file of ld AO supra, we deem it fit and appropriate, in the interest of justice and fairplay, to restore this issue also to the file of ld AO for denovo adjudication in accordance with law. Treatment of maintenance charges recovered together with rental income - Held that:- As all these issues are interlinked with each other, we deem it fit and appropriate, in the interest of justice and fairplay, to restore this issue also to the file of ld AO for denovo adjudication in accordance with law. Rate of depreciation on computer software. - Held that:- Earlier, tribunal by placing reliance on the Special Bench decision in the case of Amway India Enterprises vs DCIT [2008 (2) TMI 454 - ITAT DELHI] had allowed depreciation at the rate of 60% on computer software. - Decided in favor of assessee. Bad debts - amounts written off as irrecoverable as trading / business loss.- Held that:- the genuineness of the aforesaid deposits paid to the parties in the ordinary course of business of the assessee company was never disputed by the revenue. Hence we hold that the said write off of deposits paid in the ordinary course of business would be allowable as a trading / business loss u/s 28 of the Act.
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