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2020 (2) TMI 88 - AT - Income TaxAddition u/s. 35D OR section 37 - HELD THAT:- Appellant has incurred the expenditure for improving its coal logistic and the genuineness whereof has not been doubted by the AO when the said expenditure is allowable as revenue expenditure in one year without differing the same for a further period of 5 years or so on. The nature of expenditure was for the improvement of regular day-to-day working of the assessee-company and wholly and exclusively for the business purpose. Entire expenditure ought to have been allowed by the AO as revenue expenditure taking into consideration the ratio laid down by the Hon’ble Apex Court in the case of Taparia Tools Ltd. [2015 (3) TMI 853 - SUPREME COURT] as also decision of ITAT in the case of Pan India Food Solutions P.Ltd. [2014 (7) TMI 838 - ITAT MUMBAI] as relied upon by the ld.CIT(A) in the impugned order. Therefore, deletion of disallowance by the Ld. CIT(A) is, therefore, in our considered view is just and proper without any ambiguity so as to warrant our interference. Hence, the order is in the affirmative i.e. in favour of the assessee, and against the Revenue. Addition u/s 14A read with rule 8D - HELD THAT:- Computation for the purpose of clause (f) of Explanation 1 to Section 115JB(2) is to be made without resorting to the computation as contemplated under section 14A r.w. rule 8D. Respectfully following the above decision of the Special Bench, we allow this ground of appeal and direct the AO not to make adjustments in book profit for the purpose of MAT liability on the basis of calculations made with Rule 8D of the Income Tax Rules. No justification in reversing the order passed by the CIT(A) in deleting the enhancement of book profit made by the Learned AO to the extent of exempt, hence the Revenue’s appeal is found to be devoid of any merit, and therefore ground no.3 is dismissed.
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