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2024 (5) TMI 1092 - AT - Income TaxDisallowance u/s 14A r.w.r. 8D - expenses incurred on exempt income - HELD THAT - CIT(A) observed that if the appellant does not have any exempt income no disallowance can be made. Therefore it is proved that the assessee did not earn any exempt income during the year under consideration. We observe that the assessee has succeeded in convincing the CIT(A) that no exempt income was earned during the year under consideration. As no exempt income was earned by the assessee full relief has to be given to the assessee instead of partial relief. Accordingly we decide the issue of disallowance made u/s 14A r.w.r 8D in favour of the assessee fully and set aside the order of the ld. CIT(A) dated 25.10.2018 as well as the order of the ld. AO dated 31-03-2015 to that extent as related to disallowance and direct the ld. AO to delete the addition from the total income of the assessee. TDS u/s 195 - Listing charges paid to Bank of New York - assessee paid charges to the Bank of New York and no TDS was deducted - HELD THAT - We observe that the provisions of Section 9(1)(vii) of the Act was examined by the ld. CIT(A) but examination of the provisions of DTAA on the issue was not done. Therefore this issue of addition on account of technical services provided to the assessee should be re-examined by the AO by taking into consideration of the DTAA provisions also. We direct the ld. AO to re-examine the issue in the light of the provisions of DTAA after giving a reasonable opportunity of being heard to the assessee. Disallowance of prior period expenditure - claim of the assessee is that due to dispute on the bill amount the same could not be paid during the relevant period - HELD THAT - After carefully observing the issue we find that the observation of the ld. CIT(A) is correct. The prior period expenditure cannot be allowed in assessing the income of a particular year. We upheld the observations of the ld. CIT(A) on this issue of prior period expenditure. Thus this ground of the assessee on prior period expenses is dismissed. Writing off of Carbon Income - Recognizing income from expected sale of carbon credits based on the generation of electricity from the 18 MW wind farm project at Karnataka in the earlier years - HELD THAT - We observe that the assessee from the year of 2007-08 to 2011-12 had offered income from carbon credit and the Department had accepted it as other income. Now the assessee write off this amount due to non-recognition of the project. It is therefore our considered opinion is that the treatment which was given by the Department to the income of the assessee on carbon credit during the last five years i.e. from the year 2007-08 to 2011-12 the same treatment has to be given by the Department. Accordingly we remand this issue to the file of the AO to re-examine this issue of disallowance on carbon credit afresh. Accordingly we set-aside the order of the ld. CIT(A) on this issue. Thus we decide this issue in favour of the assessee for statistical purposes only.
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