TMI Blog2022 (5) TMI 1591X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Co-ordinate Bench of ITAT in assessee s own case in. [ 2021 (9) TMI 168 - ITAT DELHI] for A.Y. 2014-15 wherein held since, the matter of software utilized in content production, the software embedded with hardware is an integral part of the computer equipment, the issue has been repetitively held in favour of the assessee - claim depreciation on software claimed @ 60% by the assessee allowed. Interest on Late Deposit of FBT, penalty on service tax and interest on late deposit of service tax - HELD THAT:- Hon ble Apex Court observations in this regard in the case of Lachmandas Mathura Vs. CIT [ 1997 (12) TMI 16 - SUPREME COURT] held that interest on arrears of tax is compensatory in nature and not penal. Thus interest on l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me. 1.3 The entire investment of the appellant company is in unquoted subsidiary companies partly in India and partly abroad and other unquoted investment in companies for strategic business reasons and not to earn dividend, however, AO had considered entire investment for computing disallowance as such disallowance so made and upheld by learned Commissioner of (Appeals) u/s 14A is otherwise not in accordance with rule 8D. 2. That the learned Commissioner of Income Tax (Appeals) has erred both in law and on facts in upholding the disallowance of Rs 65,89,624/- by upholding the depreciation claim on various software valuing at Rs 1,88,27,498/- as technical knowhow, thereby upholding depreciation claim @ 25% as against claim made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The assessee company is engaged in the business of publishing its weekly financial newspaper viz. Financial Times, as well as distribution of newspapers and other publications of Bennett, Coleman Co. Ltd. and has also earned rental income from subletting of premises. The assessee company is also providing manpower services and has also earned capital gains arising from sale of investment. Disallowance u/s 14A: 4. The assessee company has made certain investments in shares/mutual funds/bonds etc. out of the funds either borrowed by the assessee or from company own sources. Since, these investments have yielded or may yield income in the form of dividend, long term capital gain, tax free interest etc. which does not form par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the exempt income be considered for disallowance u/s 14A. Claim of Depreciation: 6. During the year, the assessee company has claimed Rs.7,88,18,254/- as depreciation. In the scrutiny assessment for the A.Y. 2007-08 and A.Y. 2008-09, the Assessing Officer has held that the software as intangible assets since the same are in the form of licenses. Accordingly, it was subjected to depreciation @ 25% instead of @ 60% as claimed by the assessee company. This issue has been dealt by the Co-ordinate Bench of ITAT in assessee s own case in ITA No. 3124/Del/2018 for A.Y. 2014-15 wherein it was held as under: 7. The assessee incurred an expenditure of Rs.35.59 Crores on account of software, content and web hosting. The AO disallowed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : The High Court has proceeded on the basis that the interest on arrears of sales tax is penal in nature and has rejected the contention of the assessee that it is compensatory in nature. In taking the said view the High Court has placed reliance on its Ful l Bench s decision in Saraya Sugar Mills (P.) Ltd. v. CIT [1979] 116 ITR 387 (All) The learned counsel appearing for the appellant assessee states that the said judgment of the Ful l Bench has been reversed by the larger Bench of the High Court in Triveni Engg. Works Ltd. v. CIT [1983] 144 ITR 732 (All) (FB), wherein it has been held that interest on arrears of tax is compensatory in nature and not penal. This question has also been considered by this Court in Civil Appeal No. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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