TMI Blog2013 (9) TMI 961X X X X Extracts X X X X X X X X Extracts X X X X ..... be used along with the equipments. When the depreciation is allowed on the equipments, then it is also allowable on its spare parts – Decided against the Revenue. Addition towards short provision of interest on Government loan for Financial Year 2001-02 and towards short provision of DA arrears of employees – Held that:- Section 43B is not applicable to the interest on government loans and for DA arrears of employees. If the liability had finalized in the year under consideration, then the same would be allowed. The short fall in the provision was pointed out by the AG Auditors, so the A.O. made an addition - But fact remains that assessee has filed the revised return - Interest if any earned on the loan, the same will go to the State an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment loan for Financial Year 2001-02 and towards short provision of DA arrears of employes when dis-allowance was made as these amounts were not actually paid by the assessee before the prescribed date and the assessee failed to verify with the documentary evidence that these expenses had not been claimed in any other year. The brief facts of the case are that the assessee, a wholly owned undertaking of U.P. Government, is engaged in the business of generation of electricity in the State of U.P. For the assessment year under consideration, the assessee has filed the loss return, which was scrutinized by the A.O. under Section 143 (3) of the Act and made the additions, which were deleted by the First Appellate Authority as well as by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iation can be allowed on the spare parts. Finally, the A.O. made the addition, which was deleted by the appellate authorities. By considering the totality of the facts and circumstances of the case, it may be mentioned that the accounts were maintained as per the accounting standard II issued by the Institute of Chartered Accountants of India, and the said standard is mandatory for all the companies. Hence, the assessee has capitalized the value of spare parts along with the equipments. The spare parts were supplied along with the equipments to keep the same in workable conditions. It may be mentioned that the spare parts cannot be utilized independently and the same will have to be used along with the equipments. When the depreciation is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a any sum referred to in clause (ii) of sub- section (1) of section 36 or (d) any sum payable by the assessee as interest on any loan or borrowing from any public financial institution [or a State financial corporation or a State industrial investment corporation], in accordance with the terms and conditions of the agreement governing such loan or borrowing, (e) any sum payable by the assessee as interest on ay [loan or advances] form the scheduled bank in accordance with the terms and conditions of the agreement governing such loan (or advances) or (f) any sum payable by the assessee as an employer in lieu of any leave at the credit of his employee shall be allowed (irrespective of the previous year in which the liability to pay s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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