TMI Blog2014 (7) TMI 1099X X X X Extracts X X X X X X X X Extracts X X X X ..... URT). Deletion of the addition made on account of not allowing depreciation - Assessing Officer disallowed the depreciation by holding that no business was carried out. The Commissioner of Income-tax (Appeals) allowed the appeal of the assessee by holding that the assessee was carrying on the business. Therefore, there is no question of disallowance of depreciation. After hearing both sides, we find that the learned Commissioner of Income-tax (Appeals) has rightly allowed the claim of the assessee. Deletion of ad hoc disallowance at the rate of 10 per cent. of the expenses - No specific expenditure was held to be not for business purpose. Therefore, in our considered view, the ad hoc disallowance was rightly deleted by the Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sallowed 10 per cent of the other expenses of ₹ 1,73,854. The Commissioner of Income-tax (Appeals) granted the relief to the assessee against which the Revenue is in appeal by taking following grounds : The order of the learned Commissioner of Income-tax (Appeals) is wrong, perverse, illegal and against the provision of law, liable to be set aside. 2. On the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) has erred in deleting the disallowance of web and portal charges of ₹ 1,25,49,302. 3. On the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) has erred in directing the Assessing Officer to allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. (supra). The relevant paragraph of the hon'ble Delhi High Court's decision is reproduced as under : Considered in the light of these principles enunciated by the Supreme Court, it is clear that just because a particular expenditure may result in an enduring benefit would not make such an expenditure of a capital nature. What is to be seen is what is the real intent and purpose of the expenditure and as to whether there is any accretion to the fixed capital of the assessee. In the case of expenditure on a web site, there is no change in the fixed capital of the assessee. Although the website may provide an enduring benefit to an assessee, the intent and purpose behind the purpose for a website is not to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the issue involved in the third ground where addition is deleted is of ad hoc disallowance at the rate of 10 per cent. of the expenses. No specific expenditure was held to be not for business purpose. Therefore, in our considered view, the ad hoc disallowance was rightly deleted by the Commissioner of Income-tax (Appeals). The expenditure incurred on the development of web and portal charges itself shows that the assessee was carrying on the business. Considering all these aspects, we dismiss ground Nos. 3 and 4 of the Revenue's appeal. 8. Ground Nos. 1 and 5 are general in nature which require no adjudication. 9. In the result, the appeal of the Revenue is dismissed. The decision pronounced in the open court on July 2, 2014. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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