TMI Blog2013 (5) TMI 942X X X X Extracts X X X X X X X X Extracts X X X X ..... se of CIT vs. Bharti Cellular Ltd; relied upon is distinguishable from the present case as some amount of human intervention is involved in clearing of cheques by the clearing house and as such the activity constitutes technical services. 3. On the facts and circumstances whether the Ld. CIT(A) was right in treating the Bari Brahmana Branch as eligible for deduction u/s36(1)(viia) when the branch is located in Bari Brahmana town having population of 31,616/- as per the Digest of Statistics for 2002-03 published by the Government of J K. 4. On the facts and circumstances whether the Ld. CIT(A) was right in allowing 100% depreciation on wooden partitions as they are permanent structures fixed for dividing spaces in the office for the staff to work and not susceptible to dismantling. In all modern offices, it is usual to have such wooden partitions which are not shifted or relocated at regular intervals and they are always fixed at a particular location. 5. On the facts and circumstances whether the Ld. CIT(A) was right in deleting the disallowances made u/s 40(a)(ia) of the Income Tax Act, 1961 on account of non deduction of tax on interest paid to Jammu Developmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of any other credit facility which has been utilized, Processing charges has been deducted by SBI from the gross interest paid i.e. the processing charges has been deducted by SBI. Accordingly, the payment of ₹ 87,67,358/- is not attracted for disallowance u/s 40(a)(ia) of the Income Tax Act, 1961. Thus, this disallowance made by A.O. is hereby deleted. 4. The Ld. DR, Mr. Tarsem Lal argued that there was a human intervention in the services rendered by SBI and therefore, the decision of Hon ble Supreme Court in the case of CIT vs. Bharti Cellular Ltd; which is distinguishable, cannot be applied in the present facts and circumstances of the case. He, therefore, prayed to reverse the order of the ld. CIT(A). 5. The Ld. Counsel for the assessee, Mr. R.K.Gupta, relied upon the submissions made before the ld. CIT(A) and the order of the ld. CIT(A). He argued that the processing charges are collected from the FCI by SBI and net of processing charges which is interest, is received by the assessee. Therefore, such processing charges are nothing more than integral part of the interest and no tax is required to be deducted at source accordingly. 6. We have heard the ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the case of CIT vs. Bharti Cellular Ltd. (201) 234CTR (SC) 146, I am of the considered opinion that no tax is required to be deducted on MICR charges and the AO is not justified in holding that in MICR charges, technical services are attracted. Accordingly, the provisions of section 40(a)(ia) are not attracted. Thus, this ground of appeal of the appellant is allowed. 7.2. The Ld. DR, Mr. Tarsem Lal argued that there is a human intervention in the services of the clearing charges and therefore the decision of Hon ble Supreme Court in the case of CIT vs. Bharti Cellular Ltd; (supra) cannot be made applicable to the present facts and circumstances of the case. 7.3. The Ld. counsel for the assessee, Mr. R.K.Gupta,CA on the other hand, relied upon the submissions made before the Ld. CIT(A) and order of the ld. CIT(A) and argued that the ld. CIT(A) has given pertinent finding that human intervention is not required in clearing charges since clearing is done by machine which recognizes numeric data printed with magnetic charged ink is being done with the help of ultraviolet rays which scans the genuineness of cheques. Accordingly, the ld. CIT(A) following the decision of Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, the AO is not justified to take population of Bari Brahamana from the book Digest of Statistics for the year 2002-03 whereas the branch is located at a place Kartholi having population of 314 as per the last Census. He also read the meaning of place which is not defined in the in the Income Tax Act, which was placed in his written submissions placed before the CIT(A). He argued that it is the notified area which is comprising of various villages with respect to some or all the matters upon which a Municipal Fund may be expanded, improved arrangements are required. In other words, Notified area comprises of various villages as well as Mohallas without any criteria of population. The village has been defined under the State Village and Town Petrol Act, 1959 to be a parcel or parcels of land having a separate name in the revenue records and known limits and not included in the limits of a Municipality, cantonment of Town Area, provided that the District Magistrate, wherever necessary may treat a part of a village as a separate village for the purpose of this Act. He invited our attention to the decision of the ITAT, Amritsar Bench, reproduced by the ld. CIT(A) at page 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order, on identical facts, the present assessee has been allowed the claim at 100% deduction of the expenditure incurred during the year 2003-04. In the said order of the ITAT since the issue is covered by Bench s own decision and therefore, no different view can be taken in the present appeal. 12. We have heard the rival contentions and perused the facts of the case. There is no dispute to the fact that the wooden partitions were erected on the lease/rented accommodation. In our view, such wooden partitions on lease or rented accommodation are not enduring in nature and cannot be treated as capital expenditure and following our own order dated 23.01.2013 for the assessment year 2003-04, we find no infirmity in the order of the Ld. CIT(A), who has rightly allowed the claim of the assessee. Hence, ground No.4 of the revenue is dismissed. 13. As regards ground No.5 of the revenue, the brief facts are that the AO disallowed under section 40(a)(ia) of the Act, an amount of ₹ 2,58,25,857/- for non deduction of tax on interest paid by different Branches of the Bank to Jammu Development Authority. 13.1. Before the ld. CIT(A), the assessee made the submissions which were co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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