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Issues involved: The judgment involves cross appeals by the Assessee and the Revenue against the order of assessment u/s 143(3) of the Income Tax Act, 1961 for the Assessment Year 2001-02.
Assessee's Appeal: 1. The Assessee appealed against the refusal of depreciation on the cost of stock exchange card. The ITAT held in favor of the Assessee based on the decision of the Apex Court in the case of Techno Shares and Stocks Ltd v CIT, allowing depreciation u/s 32(1)(ii) on the membership in the stock exchange. 2. The appeal addressed the treatment of software expenses. The ITAT set aside this issue for fresh assessment by the AO in light of the decision in the case of DCIT v Amway Enterprises, providing the Assessee with a reasonable opportunity. 3. The Assessee contested the treatment of office repairs and maintenance expenses as capital expenditure. The ITAT upheld the decision of the CIT(A) regarding the capital expenditure incurred on office premises redesigning and allowed the balance as revenue expenditure. 4. The issue of bad debts disallowance was raised. The ITAT allowed the entire amount written off by the Assessee as a bad debt u/s 36(1)(vii) based on the decision of the Special Bench in the case of Shreyas S. Morakhia. Departmental Appeal: 1. The Revenue appealed against the allowance of software expenses as revenue expenditure. The ITAT remitted the issue to the AO for fresh assessment in line with the decision in the case of DCIT v Amway Enterprises. 2. The appeal addressed the repairs and maintenance expenses. The ITAT upheld the decision that such expenses are revenue in nature, dismissing the Revenue's appeal on this issue. 3. The deduction of employees' contribution to P.F. paid before the due date was contested. The ITAT upheld the deduction based on precedents, dismissing the Revenue's appeal on this issue. In conclusion, both the Assessee's and the Revenue's appeals were partly allowed for statistical purposes. The judgment was pronounced on March 31, 2011.
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