TMI Blog2014 (7) TMI 1314X X X X Extracts X X X X X X X X Extracts X X X X ..... I 23 - GUJARAT HIGH COURT] held that the commission paid to directors is distinctly remuneration paid for the services rendered by him. Even if it is not covered by the definition of remuneration, it would be covered by any benefit resulting directly or indirectly to such director at the cost of the company. In view of the above judicial precedents, we hold that the disallowance of commission was not warranted Depreciation of Computer Peripherals, printer and UPS - HELD THAT:- Since the expenditure is with regard to the computer peripherals, printers, UPS which can not be used stand alone, therefore, in view of the decision relied upon by the appellant, agree that in the facts and circumstances of the appellant's case, he is entitled for depreciation @ 60% . Disallowance on account of advances reimbursables written off - HELD THAT:- Appellant has credited both the fees as well as out of pocket expenses to the Profit and loss account, hence Assessing Officer s observation is not correct that debt has not been taken into account while computing the income. Further in view of the accounting treatment regularly followed by the appellant and by relying on the judgement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deleted the addition on account of commission paid to Director amounting to ₹ 1,07,50,748/-. The Revenue is further aggrieved in this year by the action of Ld. CIT(A) by which he had deleted a disallowance of ₹ 75,450/- made by the Assessing Officer invoking clause (ii) of Rule 8D (2) of I.T. Rules. 4. We first take up the appeal of the assessee in I.T.A.No. 1672/Del/2012. Ld. A.R. at the time of hearing submitted that the issue of payment of commission to Director was decided by the Tribunal order in the case of the assessee itself for the assessment year 2005-06 and 2006-07. In this respect, our attention was invited to paper book at page 60-71. Our specific attention was invited to para 17.3 17.5 at pages 69-70. It was further submitted that in the succeeding year 2009-10, Ld. CIT(A) has also already deleted a similar addition on account of commission paid to Directors and in this respect, our attention was invited to CIT(A) s order dated 27.06.2012 and it was further submitted that against this deletion, the Revenue is in appeal in I.T.A.No. 4706/Del/2012. 5. Ld. A.R. further invited our attention to paper book page 8 where copy of letter writ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king investments, therefore, he had rightly given the relief. 7. Replying to the above arguments of Ld. A.R. in respect of assessee s appeal in I.T.A.No. 1672/Del/2012 Ld. D.R. submitted that commission paid to directors was quite excessive the Ld. D.R. therefore, Assessing Officer had rightly made the additions. As regards the assessee s appeal in assessment year 2009-10 in I.T.A.No. 4563/Del/2012, the Ld. D.R. submitted that Ld. CIT(A) had already allowed appropriate relief against which Revenue is already in appeal in I.T.A.No. 4706/Del/2012. 8. Arguing revenue s appeal in assessment year 2009-10 in I.T.A.No. 4706/Del/2012, Ld. D.R. submitted that payment of commission was quite high and therefore was rightly disallowed by the Assessing Officer and Ld. CIT(A) without considering the facts of the present case, followed the earlier order of the Tribunal in the case of assessee itself in assessment year 2005- 06 2006-07. Regarding 2nd ground, Ld. D.R. submitted that Ld. CIT(A) wrongly allowed relief of ₹ 75,415/- as there was interest bearing funds also which were used for making investments. 9. We have heard rival parties and have gone through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above issue the appellant made the following submission the gist of which is as under: .The appellant company has claimed depreciation at the rate of 60% on addition of computer peripherals, printers, UPS etc. All these items as claimed form an integral part of the computer, ----- Ups/ switches/ cable/ port/ connectors etc. can be used only with the computers and cannot be used on standalone basis during the course of the Assessment proceedings/ a detailed list of the additions made to computers on which 60% depreciation was claimed by the assessee company was provided to the LO AO (copy enclosed as annexure-9 ) it is a well settled law now that the word computer has ,to be read as computer system comprising of the all connecting devices which are essential parts of the computers. In the light of judicial pronouncement of ACIT Vis. Container Corporation/ ITAT Delhi Bench and ITO Vs. Samiran Majumdar/ ITAT Kolkata bench (Copy of judgements are attached as per Annexure 10 11).------H 10. I have carefully considered the contentions of the appellant and have gone through the various judicial precedents relied upon by the appellant. Since the exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar of raising of invoices. The AO on one hand has allowed fees written off while on the other he has disallowed the amount recoverable from the clients on account of expenses incurred. In the light of Judgement of TRF Limited Vs. CIT, as decided by Hon'ble Supreme court, in which the apex court has held that This position in law is well-settled. After 1stApril, 1989, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable. It is enough if the bad debt is written off as irrecoverable in the accounts of the assessee (as per Annexure 13).--- 12. I have carefully considered the contentions of the appellant and have gone through the judicial precedents relied upon by the appellant. It is seen that the appellant has credited both the fees as well as out of pocket expenses to the Profit and loss account, hence Assessing Officer s observation is not correct that debt has not been taken into account while computing the income. Further in view of the accounting treatment regularly followed by the appellant and by relying on the judgement of Apex Court in the case of TRF Limited Vs CIT (230 CTR 14) (S.C.), the claims of bad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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