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2013 (12) TMI 1058 - AT - Income TaxDisallowance u/s 40(a)(ia) – Expenses on catalysts - Held that:- A perusal of the copies of the invoice clearly indicates that the relevant product involved in the purchase is 'catalyst for phthalic anhydride' in the form of ring - This does not suggest that the assessee has purchased any 'patent, invention, model, design, secret formulae or process or trade mark or similar property' which in fact requires the element of the purchase of an intangible asset - Neither the findings of the AO nor that of the Ld. CIT(A) is based on any evidence to support that the payment was ‘royalty” - Decided in favour of assesse. Valuation of stock – Held that:- Following assessee's own case for the assessment year 2006-07 - All the relevant debits and credits (purchases, sales etc) in the profit and loss account should be grossed up – The issue was restored for fresh decision. Disallowance under section 14A – Held that:- Following assessee's own case for the assessment year 2006-07 - Rule 8D is not applicable prior to assessment year 2008-09 – The quantum of disallowance should be computed using some reasonable method - The quantum of disallowance was restricted to 2% of dividend income – The issue was restored for fresh decision. Validity of ground for appeal u/s 246A - Credit for TDS not granted – Held that:- Following M. Chockalingam & M. Meyyappan v. CIT [1962 (10) TMI 48 - SUPREME COURT] - The expression, viz., "amount of tax determined" as employed in section 246(1)(a), encompasses not only the determination of the amount of tax on the total income but also any other act of omission which has the effect of reducing or enhancing the total amount payable by the assessee – This is a valid ground acceptable u/s 246A - The issue was restored for fresh decision.
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