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TMI Blog2015 (12) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure that will be disallowed U/s.14A of the Act.As far as the assessment year 2009-10 is concerned, since Rule 8D comes into effect from that assessment year onwards, we do not find any infirmity in the order of the Ld. CIT (A), who has applied only Rule-14A and reworked the disallowance U/s.14A of the Act and arrived at the disallowance at ₹ 12,31,129/- as against ₹ 14,95,934/- worked out by the Ld. Assessing Officer. Accordingly, the order of the Ld. CIT (A) is confirmed for the assessment year 2009-10. - Decided partly in favour of assessee. Computing deduction U/s. 10A - not reducing the overseas travel expenses and telecommunication expenses incurred in foreign currency from the total turnover when the same is exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat such donation is paid for meeting out the objects of the company directly or indirectly, though as per Income Tax Act such donation may not be allowable as a deduction. The decision of the Ld. CIT (A) in directing the Ld. Assessing Officer to treat the donation paid as allowable expenditure while computing the book profit of the assessee for the purpose of section 115JB of the Act is correct. Therefore we hereby confirm the order of the Ld. CIT (A) on this issue.- Decided against revenue - I.T.A.Nos.58 & 1280/Mds./2014, I.T.A.Nos.362 & 2021/Mds./2014 - - - Dated:- 2-6-2015 - SHRI N.R.S.GANESAN, JUDICIAL MEMBER AND SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER Appellant by : Mr.K.M.Mohandass C.A Respondent by : Mr.S.Dasgupt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rounds in its appeal for the A.Ys 2008-09 2009-10 respectively and the same are concised herein below as follows:- i) Ld. CIT (A) had erred in treating the soft ware expenses for `16.03 lakhs as revenue expenditure for A.Y.2008-09. ii) Ld. CIT (A) had erred in deleting the addition made towards donation of `8.35 lakhs while computing the book profit U/s. 115JB of the Act for A.Y.2008-09. iii) Ld. CIT (A) had erred in computing deduction U/s. 10B of the Act by reducing the overseas travel expenses and telecommunication expenses incurred in foreign currency from the total turnover while as the same has to be excluded only from the export turnover for the A.Y.2009-10. 3. The brief facts of the case are that the assessee is a priv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all be treated as the expenditure incurred towards earning such exempt income U/s.14A of the Act. Accordingly, for the assessment year 2008-09 in the case of the assessee, we hereby hold that 3% of the exempt income shall be treated as the expenditure that will be disallowed U/s.14A of the Act. 4.3 As far as the assessment year 2009-10 is concerned, since Rule 8D comes into effect from that assessment year onwards, we do not find any infirmity in the order of the Ld. CIT (A), who has applied only Rule-14A and reworked the disallowance U/s.14A of the Act and arrived at the disallowance at `12,31,129/- as against `14,95,934/- worked out by the Ld. Assessing Officer. Accordingly, the order of the Ld. CIT (A) is confirmed for the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 277, Ld. CIT Vs. Amway India Enterprises Ltd., reported in 22 Taxmann.com 22 and the Mumbai Bench of the Tribunal in the case Ajit Kumar C. Kamdat Vs. DCIT reported in 4(II) ITCL 76 held the issue in favour of the assessee by treating the entire expenses of `32,42,522/- as revenue expenditure. Since no further materials or arguments is brought before us by the Revenue to counter the decision of the Ld.CIT(A) and since the Ld. CIT (A) has only followed the decision of the Hon ble Delhi High Court and Mumbai Bench of the Tribunal in arriving at his decision, we hereby confirm the order of the Ld. CIT (A). 6.2 Ground No.ii) - Deleting the addition made towards donation of `8.35 lakhs while computing the book profit U/s. 115JB of the Act f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany as per Schedules VI Part-II of the Companies Act, the only place it finds is in item No.3(x)(i) under the head Miscellaneous expenditure which may be followed with a note. vi) Accordingly, Net profit will stand reduced to the extent of the donation paid in the P L account of the company which will be the book profit of the company as per the companies Act. From the above analogy we find that the decision of the Ld. CIT (A) in directing the Ld. Assessing Officer to treat the donation paid as allowable expenditure while computing the book profit of the assessee for the purpose of section 115JB of the Act is correct. Therefore we hereby confirm the order of the Ld. CIT (A) on this issue. 6.3 Ground No.iii) - reducing the overse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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