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2020 (2) TMI 948 - AT - Income TaxDisallowance of entrance fees towards corporate membership of club - nature of expenditure - revenue or capital - HELD THAT:- The purpose of the expenditure is to have a suitable platform for meeting people and getting advantages of meeting many people at a time to maintain old contacts and also to make new contacts. The main purpose of the organization is to induce its officers to attend such places for maintaining and making contacts for the benefit of business. Even if some personal advantage is obtained by officers, it will be in nature of maintaining good relations with officers and in nature of staff welfare expenses - the expenses are incurred wholly and exclusively for the purpose of business. By obtaining membership for a period of more than one year, there may be an advantage which is in the field of revenue benefit and not for obtaining any capital asset or obtaining benefit in capital field. Therefore, such expenses will be of revenue nature. For that assessee relied on the judgment of the Hon`ble Delhi High Court in the case of CIT vs. Samtel Color Ltd. [2009 (1) TMI 26 - DELHI HIGH COURT] wherein consider allowability of corporate membership fees of clubs as allowable business expenditure. We find merit in the submissions of the ld counsel and direct the AO to treat entrance fees paid to club as revenue expenditure. Disallowance u/s 40(a)(ia) for non-deposit of TDS - deduction and deposits before the due date of filing of return of income - HELD THAT:- We note that the said TDS was paid before the filing of return of income u/s. 139(1) of the I.T. Act, therefore no addition should be made for that we rely on the judgement of VIRGIN CREATIONS [2011 (11) TMI 348 - CALCUTTA HIGH COURT] wherein it was held that the said TDS should be allowed. Respectfully following the decision of jurisdictional High Court, we hold that since the assessee has deducted and deposited tax on contractual payments under consideration before the due date of filing of return of income, disallowance u/s 40(a)(ia) is not warranted, therefore, we delete the disallowance Disallowance u/s 14A r.w.r. 8D - HELD THAT:- As relying on NICE BOMBAY TRANSPORT (P) LTD. VERSUS ACIT (OSD) , CIT (V) , NEW DELHI [2019 (4) TMI 42 - ITAT DELHI] Application of Rule 8D to the facts of the case is not correct, hence, the addition on this account is hereby directed to be deleted.
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