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Showing 161 to 180 of 1764 Records
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2016 (11) TMI 1608
The High Court of Madras issued a notice to the respondent company, returnable on 23.12.2016, and ordered service to be effected via private mode. The matter will be listed before the Court immediately after service is completed.
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2016 (11) TMI 1607
Disallowance of expenses u/s 40(a)(i)/40(a)(ia) - disallow payments when TDS was not done and subsequently become taxable on account of a retrospective legislation - HELD THAT:- CIT(A) followed the decision of this Tribunal in M/s WS Atkins India Pvt. Ltd, supra, which referred the decisions of Hyderabad Bench of the Tribunal in Infotech Enterprises Ltd [2014 (1) TMI 1363 - ITAT HYDERABAD] wherein it has been held that section 40(a)(ia) would not apply to disallow payments when TDS was not done and subsequent ly become taxable on ac count of a retrospective legislation. It has also referred to the decisions of the Delhi & Mumbai Tribunal in SMS Demag Pvt Ltd [2018 (1) TMI 184 - ITAT DELHI] & Sonic Biochem Extractions Pvt. Ltd. [2013 (9) TMI 193 - ITAT MUMBAI]. We uphold the decision of the CIT(A) and dismiss the grounds raised by the Revenue.
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2016 (11) TMI 1606
Grant of Excise licence to run country liquor shops - one eligibility conditions for grant of license is that licensee and his family members must possess good moral character and have no criminal background - It was alleged in the FIR that Vinod Kumar Tripathi and his wife Asha Tripathi, Respondent Nos. 2 and 3 respectively had committed fraud and forgery by opening bank account in the name of the Respondent No. 1 by affixing his photograph, submitting his ID and had withdrawn amount by forging his signature and deposited the security amount with District Excise Officer, Allahabad - Held that:- It is expected that the High Courts while dealing with the lis are expected to focus on the process of adjudication and decide the matter. The concept, what is thought of or experienced cannot be ingrained or engrafted into an order solely because such a thought has struck the adjudicator. It must flow from the factual base and based on law. To elaborate, there cannot be general comments on the investigation or for that matter, issuance of host of directions for constituting separate specialized cadre managed by officials or to require an affidavit to be filed whether sanctioned strength of police is adequate or not to maintain law and order or involvement of judicial officers or directions in the like manner. To say the least, some of the directions issued are not permissible and all of them are totally unrelated to the case before the High Court - the High Court should have been well advised to restrict the adjudicatory process that pertained to the controversy that was before it.
A Judge should not perceive a situation in a generalised manner. He ought not to wear a pair of spectacles so that he can see what he intends to see. There has to be a set of facts to express an opinion and that too, within the parameters of law.
Some of the directions are in the sphere of policy. A court cannot take steps for framing a policy. As is evincible, the directions issued by the High Court and the queries made by it related to various spheres which, we are constrained to think, the High Court should not have gone into. It had a very limited lis before it. Be it stated, the directions may definitely show some anxiety on the part of the learned Judges, but it is to be remembered that directions are not issued solely out of concern. They have to be founded on certain legally justifiable principles that have roots in the laws of the country.
Thus, the High Court has crossed the boundaries of the controversy that was before it. The courts are required to exercise the power of judicial review regard being had to the controversy before it. There may be a laudable object in the mind but it must flow from the facts before it or there has to be a specific litigation before it - In the maintenance of law and order situation the judicial officers are not to be involved. But the executive has to remain absolutely alive to its duties and we are sure, the State Government shall look into the aspects and endeavour to see that appropriate steps are taken to maintain the law and order situation.
The impugned order passed by the High Court is set aside - appeal allowed.
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2016 (11) TMI 1605
TPO - Comparable selection - inward Technologies Ltd. has been wrongly excluded from the list of comparable, therefore, the same should included in the list of comparables - AR prayed for excluding from the list of comparables Tata Technologies Ltd. having operating margin of 31.18% on the ground of high profit making company - Held that:- There is no dispute in respect of settled position that the consistent loss making company has to be excluded from the list of comparables. A company is said to be consistent loss making when the company has incurred losses in the three consecutive financial years including the financial year in which the international transactions have been made. In the instant case Financial Year 2009-10 is relevant to the assessment year under appeal. Thus, the financial years to be considered for determining whether the company is consistent loss making are financial years 2007-08, 2008-09 and 2009-10. A perusal of the profit and loss account of Onward Technologies Ltd. placed on record shows that the said company has suffered losses in financial years 2007-08, 2008-09 and 2009-10.
Thus, it is evident from the perusal of the financial results of Onward Technologies Ltd. that Onward Technologies Ltd. is consistent loss making company, therefore, the said company cannot be considered as a good comparable.
Exclusion of Tata Technologies Ltd., the ld. AR has not substantiated as to how the said company has abnormal profits. We do not find any merit in the appeal of the assessee and the same is dismissed.
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2016 (11) TMI 1604
Disallowance of deduction u/s 80IA - assessee has not employed more than 10 employees - Held that:- Material evidence available on record shows that Shri. Sowrirajan was working in the factory in the day time and since he is staying in the premises of the assessee, he was also shown as chowkidar. This Tribunal is of the considered opinion that an individual cannot be forced to work for more than eight hours in a day and if the assessee compels Shri. Sowrirajan to work in the day time in the factory and as a chowkidar in the night, it would be contrary to the provisions of labour welfare legislation. Therefore, the explanation of the assessee is contrary to the existing statutory provisions. Tribunal is of the considered opinion that Shri. Sowrirajan stay in the factory premises in the night cannot be considered as employment in the manufacturing process.
Coming to the consultant so long as the consultant is not shown as an employee of the assessee in its pay role, he cannot be considered as an employee participating in the manufacturing process. The assessee may consult several consultants for several purposes including legal and technical aspect. It is not known, what are the functions the consultant performed in the manufacturing process of the assessee. Unless and until, it is established that the consultant has performed a role in the manufacturing of diesel generator, this Tribunal is of the considered opinion that such a consultant cannot be considered as an employee participating in the manufacturing process of the assessee - Decided against assessee.
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2016 (11) TMI 1603
Entitlement to the benefit of deduction u/s. 80P(2)(a)(i) - AO held that the assessee is engaged in the business of banking and in view of section 80P(4), since the assessee is not a Primary Agricultural Credit Society or a Primary Co-operative Agricultural and Rural Development Bank, it is not entitled to deduction - Held that:- The Hon’ble High Court of Kerala has categorically held in assessee’s own case for the assessment year 2007-08 [2016 (5) TMI 1164 - KERALA HIGH COURT] that the assessee is not a primary agricultural credit society and it is a co-operative bank. The Hon’ble High Court further held that the assessee is not entitled to deduction u/s. 80P(2) of the Act, in view of introduction of section 80P(4) of the Act with effect from 01/04/2007. Thus order of the CIT(A) in denying the benefit of deduction u/s. 80P(2) of the Act is correct - Decided against assessee.
Disallowance of contribution made to unrecognized Superannuation Fund - Held that:- We notice that for the assessment year 2009-10 the assessee has accepted the CIT(A)’s order and no further appeal was preferred to the Tribunal. The assessee’s contention that to the extent of withdrawals made by the employees from unrecognized provident fund should be allowed as deduction u/s. 37 of the I.T. Act was never raised before any of the authorities below. Hence, this plea of the assessee is rejected.
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2016 (11) TMI 1602
Exemption under Section 54F - expenditure purportedly incurred by the assessee on renovating the new asset, after its purchase by the assessee, to make it habitable - whether be included in the cost of the new asset? - Held that:- Tribunal has allowed the respondentassessee's appeal by following the decisions of its Coordinate Benches at Mumbai in Saleem Fazuebhoi v/s. DCIT [2006 (6) TMI 139 - ITAT BOMBAY-G] to hold that the expenditure incurred on making the house habitable should be considered as an investment in purchase of a house, subject to the condition that the payment was made during the specified period under Section 54F of the Act. The Revenue has accepted the above two decisions of the Tribunal. This for the reason that it has not been able to show that any appeal has been filed from the two aforesaid decisions of the Coordinate Benches of the Tribunal. The impugned order has merely been followed by the impugned order of the Tribunal.
Improvement cost inclusion in the cost of the new asset while working out the exemption under Section 54F - Held that:- The impugned order of the Tribunal records “we have considered the rival submissions as well as the relevant material on record. There is no dispute that the assessee has incurred an expenditure of ₹ 58.26 lakhs on the improvement of the flat purchased by the assessee to make in a habitable condition.” The aforesaid statement recorded by the Tribunal has to be accepted in the absence of the same being rectified by it. It therefore follows that before the Tribunal the Revenue did not urge that the expenditure of ₹ 58.26 lakhs had not been in fact incurred to improve the flat so as to make it in habitable condition. No substantial question of law.
Appeal admitted on the substantial questions of law at question nos. (1) and (4).
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2016 (11) TMI 1601
Earning on sale of shares of Talent Infoway Ltd - change of head of income - disputes under the head of income from other sources - Held that:- The option of the assessee in matters of the claim relating to the profits / gains on sale of shares based on the entries in the books of accounts, assumes significance.
The Officers are prevented from changing the head of income for taxing the said gains arbitrarily and without having contrary evidence against the assessee. The said Circular No. 6/2016 enlists certain conditions and the Revenue Authorities are required to examine the said Circular (supra) closely and adjudicate this issue after grating a reasonable opportunity of being heard to the assessee. For this purpose, we remand this matter to the file of the AO.
Prima facie, we find, the contents of para 3(a) and other paragraphs of the said Board Circular do not permit the Revenue Authorities to change the head of income from "business income" to "the capital gains" or vice versa, unless the conditions specified in para 4 of the said Circular (supra) ie bogus claims or sham transactions / questionable transactions are involved. The Revenue Authorities are required to honour the books of account and the entries therein pertaining to the shares - Appeal of the assessee is allowed for statistical purposes.
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2016 (11) TMI 1600
Expenses incurred on Information Technology by the Head office on and charged to the Indian Branch - assessee was deductible u/s 37(1) without any restrictions contained in Section 44C? - Held that:- The grievance being that the expenditure incurred on Information Technology to the extent of ₹ 14.99 crores cannot be disallowed u/s 40A(i) for failure to deduct tax at source. It is clear that the the Revenue was not aggrieved by the order of the CIT(A) allowing deduction under Section 37(1) and also with the direction of the CIT(A) that the aforesaid payment would not be allowed as a deduction under Section 44C, therefore in the above view it is not open for the Revenue to urge this issue before us when the same was not urged before the Tribunal leading to the impugned order of the Tribunal. Question no.1 as formulated does not give rise to any substantial question of law
National loss arising from revaluation of unmatured forward exchange contract - Allowable deduction - no accrual as the forward contract was not settled and without appreciating the true nature of the transaction - Held that:- Issue stands covered in favour of the assessee and against the Revenue by the decision of this Court in Commissioner of Income Tax v/s. Bank of India reported in [1995 (11) TMI 78 - BOMBAY HIGH COURT].
Appeal admitted on the substantial questions of law at question nos. (2), (3) and (5).
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2016 (11) TMI 1599
Disallowance of deduction claimed for payment of interest u/s 36(1)(iii) on bank loan, - AO found certain loans/advances to have been given by the assessee to his family members and sister concerns/companies, without charging interest - CIT-A allowed claim - Held that:- No error in the order of the ld. CIT(A) on this issue. The department has not been able to refute the categorical finding of fact recorded by the CIT(A) in the case of M/s Roger Exports, to the effect that the loans and advances were extended for business purpose of the assessee. Moreover, it also remains undisputed that the assessee had adequate interest free funds available for making the loans and advances in question - Decided in favour of assessee
Deemed dividend addition u/s 2(22)(e) - amount was paid to M/s Roger Industries Ltd. for the individual benefit of the assessee - CIT(A) deleted the addition - Held that:- As correctly taken into account by CIT(A), that no amount was received directly by the assessee from M/s Euro Safety Footwear Pvt. Ltd., wherein, the assessee was having more than 10% of shareholding. On the date of payment of ₹ 1 crore to M/s Roger Industries Ltd., i.e., 13.12.2007, the proprietorship concern stood already taken over by M/s Roger Industries Ltd. CIT(A) had specifically inquired of the AO, to show that the amount of ₹ 1 crore had been paid for the individual benefit of or on behalf of the assessee. Nothing to this effect was brought on record by the AO and the remand report of the AO is totally silent in this regard, but for making a bald assertion that the amount was paid to M/s Roger Industries Ltd. for the individual benefit of the assessee. CIT(A) has observed that later on in the remand report, the AO had himself stated that the amount taken by M/s Roger Industries Ltd. was utilized for payments made to cater for the need of M/s Roger Industries Ltd., i.e., for purchase of goods.
On the basis of the above, it is seen that the ld. CIT(A) was well justified in holding that deemed dividend can be taxed only in the hands of the recipient, either being individual shareholder, or the concern in which the individual has a substantial interest, or if any payment is made on behalf of, or for the individual benefit of the individual shareholder, which is not the case herein. - Decided against revenue.
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2016 (11) TMI 1598
Correct head of income - Leave and license charges and service charge - Addition under the head income from house property or income from business - assessee entered into leave and license agreement and service agreement separately in respect of leasing out of industrial premises and for providing services - Held that:- The assessee company has given its two industrial buildings i.e. Indiplex-I and Indiplex-II on lease and received license fee and service charges which was shown as business income. We find from the objects of the company as mentioned in the Memorandum of Association, the main objects of the Company was to acquire properties and construct and hold the property. During this process assessee earned these leave and license charges as well as service charges.
We find that this issue is covered in favour of assessee and against Revenue by the decision of Hon’ble Supreme Court in the case of Chennai Properties and Investments Ltd. Vs. CIT [2015 (5) TMI 46 - SUPREME COURT] the circumstances of the present case from which we arrive at irresistible conclusion that in this case, letting of the properties is in fact is the business of the assessee. The assessee therefore, rightly disclosed the income under the Head Income from Business. It cannot be treated as 'income from the house property' - Decided in favour of assessee.
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2016 (11) TMI 1597
Renovation expenditure - Allowable Revenue expenditure - expenditure incurred by the assessee in replacing the mosaic floor by marble floor - Held that:- It appears that the hotel run by the assessee was classified as four star hotel since 1971. Therefore, the assessee has to necessarily have Air Conditioner Machine, Dishwash Machine and Audio Video in Resto Pub. This Tribunal is of the considered opinion that in the absence of any material to suggest that the assessee has purchased any new machinery, it has to be considered only as replacement of the existing machinery. When we consider the hotel as a single unit, replacement of Air Conditioner Machine, Dishwash Machine and Audio Video in Resto Pub has to be considered as maintenance of the building for the purpose of running the business of hotel. Therefore, the CIT(A) has rightly found that the expenditure was revenue in nature. - decided against revenue.
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2016 (11) TMI 1596
Disallowance u/s 10A - splitting up or reconstruction of the existing unit - Held that:- For the assessment year 2007-08 the CIT(A) has examined the Business Transfer Agreement and found that there was no case of splitting up or reconstruction of the existing unit and allowed the claim of the assessee u/s 10A of the Act. However, both the CIT(A) and the Assessing Officer have not considered the CBDT Circular No.1 of 2013 while deciding the issue. Therefore, we set aside the orders of the lower authorities for both the assessment years under consideration and remit the matter back to the Assessing Officer to examine the case in the light of CBDT Circular No.1 of 2013 and decide on merits after giving due opportunity to the assessee. - Appeals of the Revenue are allowed for statistical purposes.
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2016 (11) TMI 1595
Fresh claims on account of disallowance u/s 43B pertaining to payment on account of Royalty and interest thereon - Held that:- In case of the Commissioner of Income Tax Vs. Pruthvi Brokers and Shareholders Ltd [2012 (7) TMI 158 - BOMBAY HIGH COURT] has held that an assessee is entitled to raise an issue before the Appellate Authorities even if the same had not been claimed during the assessment proceedings. The above view of this Court was by following the decision of the Apex Court in National Thermal Power Corporation Ltd. Vs. Commissioner of Income Tax [1996 (12) TMI 7 - SUPREME COURT] and Jute Corporation of India Vs. Commissioner of Income Tax [1990 (9) TMI 6 - SUPREME COURT].
Disallowance made in respect of payments made under Voluntary retirement Scheme of the company - Held that:- The decision of this Court in Godrej GE Applicances Ltd. [2008 (9) TMI 1002 - BOMBAY HIGH COURT] does conclude the issue against revenue and in favour of the respondent – assessee.
Disallowance made for delayed payment of employees contribution to Provident Fund - Held that:- Issue arising herein stands concluded by the decisions of this Court in Commissioner of Income Tax Vs. Hindustan Organics Chemicals Ltd. (2014 (7) TMI 477 - BOMBAY HIGH COURT) and the Commissioner of Income Tax Vs. Ghatge Patil Transports Ltd. (2014 (10) TMI 402 - BOMBAY HIGH COURT) decided in favour of the respondent – assessee and against the revenue.
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2016 (11) TMI 1594
Disallowance of interest u/s 14A r.w.r. 8D - Held that:- we find that the only disallowance of interest under section 14A read with rule 8D of the IT Rules, the assessee had share of Girdharilal Sugar & Allied Ind Ltd. costing ₹ 88 lacs and as per rule 8D the interest disallowance can be made 050% of average investment which comes to ₹ 44,006/-. Accordingly, we allow the appeals of the assessee for the assessment years 2007-08, 2008-09 and 2009-10 because the same investment of ₹ 88 lacs is coming out from the assessment year 2006-07, 2007-08, 2008-09 and 2009-10
Disallowance u/s 40(a)(ia) - Non deduction of tds on printing and stationary expenses - amount already paid during the year or amount shown payable as on 31st March of every year - Held that:- After the amendment in section 40(a)(ia) of the Act with effect from 1.4.2015 it was held that disallowance u/s 40(a)(ia) of the Act should be restricted to 30% of the amount of interest paid - Respectfully following the judgment of this Bench in the case of ACIT, Circle-4, Jaipur vs. Shri Girdhari Lal Bargoti [2015 (11) TMI 746 - ITAT JAIPUR], the disallowance made by the A.O. u/s 40(a)(ia) of the Act as raised in the grounds of appeal is deleted. Thus, the solitary ground of the assessee is allowed. Restrict the disallowance u/s 40(a)(ia) of the Act to 30% which comes to ₹ 11,400/- in the assessment year 2008- 09 and ₹ 12,161/- in the assessment year 2009-10
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2016 (11) TMI 1593
TDS u/s 195 - Disallowance of expenses on payment of training fees royalty - non-deduction of TDS - PE in India - Held that:- Tribunal order in assessee’s own case for the A.Y. 2008-09 [2015 (5) TMI 1169 - ITAT MUMBAI] wherein exactly identical issue is dealt with as regards to the payment of training fees, service fees and royalty payments for the subject matter as in the present case and Tribunal has deleted the disallowance holding that the assessee is engaged in sales and services of safety equipments installed on board marine vessels, that it would get business from the equipment manufacturers, that after completing the servicing of safety equipments it would issues a certificate to the vessels operating in International waters, that it would purchase blank certificates from equipment manufacturers, that it also undertook servicing of life boats and its lunching appliances, that to carry out the servicing of such equipments service personnel would be sent outside India for training, that the training fee included accommodation and conveyance, that both these payments were reimbursement of actual expenditure, that no TDS is required to be deducted for such payments
As non-residents had no PE in India, that the assessee was not liable to deduct tax at source for these payments. - Decided in favour of assessee.
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2016 (11) TMI 1592
Disallowance of pension paid to the retired partners - Expenditure allowable u/s 37(1) - addition made by both on diversion of income by overriding title as well as the revenue expenditure u/s 37(1) - Held that:- When the partnership deed specifies that the payment made to the retiring partner is with regard to the work done by them during the tenure as a partner and towards the settlement of their income for the work done and to allow the partnership firm to continue its business, the payment cannot be held as an application of income or gratuitous payment. We therefore hold that the payment is a diversion by overriding title and cannot be included in the total income.
Allowance of expenditure u/s 37(1) - As the payment made to retiring partners is diversion of income by overriding title, the ground raised by the assessee became infructuous and hence dismissed.
TDS credit suffered by the assessee in connection with the professional fees received from clients - Held that:- CIT(A) in her appellate order, has directed the Assessing Officer to verify the claim of the assessee vis-à-vis Form 26AS and give for the correct amount of T.D.S. Giving correct amount of payment of taxes is the duty of the assessing officer. The assessee should not be made to suffer for getting the refund of taxes paid. We direct the assessing officer to allow the correct amount of TDS without any further delay. This ground is allowed for statistical purposes.
Levy of interest u/s 234D - Held that:- AO is directed to examine the applicability of interest u/s 234D and levy correct amount of interest.
Accrual of income - Addition towards advance fee - assessee contended that the amount of advances were received from clients for the services not yet rendered, therefore, the income is not accrued and accordingly, the advance cannot partake the character of income - Held that:- We agree with the submission of the assessee that the advance cannot be treated as income in the hands of the assessee unless the services are rendered by the assessee. The Assessing Officer has not made out a case that advances received in question were towards the services rendered by the assessee. The ld. DR also could not bring any evidence to controvert the submissions made by the assessee. Revenue’s appeal is dismissed.
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2016 (11) TMI 1591
Utilization of Cenvat credit availed on Basic Excise Duty for payment of Education Cess and Higher Education Cess - Held that:- The issue involved is covered by the judgment of Hon'ble Gujarat High Court in Madura Industries Textiles case [2013 (1) TMI 352 - GUJARAT HIGH COURT], where reliance placed in the case of CCE Vapi Vs. M/s Balaji Industries [2008 (7) TMI 215 - CESTAT AHEMDABAD], where it was held that the benefit of utilization of credit of basic excise duty for payment of education cess is to be allowed - appeal allowed - decided in favor of appellant.
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2016 (11) TMI 1590
CENVAT credit - Tribunal followed the judgment of Sharad SSK v. CCE, Bilaspur [2014 (9) TMI 768 - CESTAT MUMBAI], wherein it was held that if the assessee has reversed the entire amount of inputs/input service used for generation of electricity and sold outside and then in case the assessee is not required to pay an amount equal to 8/10% of the value of electricity.
The judgment passed by the CESTAT, Mumbai has not been challenged. We fail to understand how after having accepted the judgment in CESTAT, Mumbai, the authorities can challenge the same in another State when the law is identical - appeal dismissed.
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2016 (11) TMI 1589
Disallowance of loss being speculative loss - Held that:- We find that both the CIT(A) and the Tribunal have come to a concurrent finding of fact that actual delivery of the bullion had taken place. Therefore, the loss on account of trading in bullion was not a speculative loss but a business loss. Thus, the above finding of fact led to allowing the loss on account of trading in bullion, being set off as a business loss from the profits made on account of consultancy in mining. This concurrent findings of fact by the CIT(A) and the Tribunal, has not shown to be perverse in any manner. No substantial question of law
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