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2020 (11) TMI 613 - HC - Income TaxDisallowance u/s 14A r.w.r. 8D - Tribunal confirming the decision of CIT (A) restricting the disallowance to the extent of exempt income - HELD THAT:- Tribunal, while dismissing the appeal of the Revenue on the question of disallowance under Section 14A in conformity with the judicial precedents, find substantial merit in the conclusion drawn by the CIT(A) for limiting the disallowance to the extent of exempt income. Hence, we decline to interfere. - Decided against revenue. Nature of expenditure - expenses incurred on account of professional and legal fees - revenue or capital expenditure - HELD THAT:- Professional fees paid by Appellant are for existing business and not incurred for analyzing the market for new line of business or is not for diversification of its business. By incurring such expenditure, Appellant is constantly getting updates regarding market survey carried out for existing product line and same does not give any enduring benefit or is not in nature of capital expenditure. The expenses are not incur red for exploring the market for a new product and rather expenses is incurred for exploring the circumstances as to how Assessee should manage it s existing business more effectively hence relying upon the decision of Hon'ble Delhi ITAT in the case of KJS India Pvt. Limited [2010 (7) TMI 797 - ITAT DELHI] expenditure incur red by Appellant is business expenditure allowable under Section 37. Also in the case of Majestic Auto Limited [2009 (1) TMI 57 - PUNJAB AND HARYANA HIGH COURT] on similar circumstances held that expenditure incurred for obtaining report on reorganization of its core business and for improving market share and profit ability is allowable as revenue expenditure. Expenditure incurred by Appellant is allowable as revenue expenditure. - Decided in favour of assessee.
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