This case deals with various issues related to deductions and ...

Tax Deductions & Allowances: Navigating Complexities.

Case Laws     Income Tax

September 6, 2024

This case deals with various issues related to deductions and allowances under the Income Tax Act. The key points are: Deduction u/s 80IB for profits from an industrial unit was allowed based on separate profit and loss account filed. Deduction u/s 80HHC for export profits was allowed, as the retrospective amendment disallowing deduction for DEPB license sale was struck down. Disallowance of commission paid was set aside for lack of evidence. Expenditure on repairs and replacements of plant and machinery was held allowable as revenue expenditure u/s 31. Service charges paid to a group company were held allowable. Community development expenses were treated as business expenditure. Entrance fees paid to clubs for employee welfare were held allowable. Short-term capital loss on sale of investments was directed to be re-examined for allowability. Expenditure on aircraft maintenance and depreciation during trial run was allowed. Deduction u/s 80HHC was remanded for computation based on book profits. Market value for transfer pricing u/s 80IA was accepted. Disallowance of repair expenses on an estimated basis was set aside. Write-back of provision was held non-taxable as already offered earlier.

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