S. 40(a)(i) : Amounts not deductible-Deduction at source-Non-resident –Amount paid to a foreign company towards management fees-Tax deducted and deposited-No addition could be made under section 40(a)(i), or the payment can be held to be as unexplained expenditure under section 69C.[S, 69C, 195]
S.37(1): Business expenditure-Site maintenance expenditure-Ad-hoc disallowance of 30 per cent-Disallowance restricted to 10 percent of expenditure.
S.37(1): Business expenditure-Capital or revenue-Licence fee for use of software-Allowable as revenue expenditure.
S.37(1): Business expenditure-Setting up of business-Actual commencement of revenue-generating activity does not have any bearing on determining the date of setting up of business-Expenses incurred after the date of setting up of business are eligible for deduction. [S.28(i)]
S. 37(1): Business expenditure-Unrealised debtors-Write-off-Income offered in the subsequent years when realised-Order of CIT(A) deleting the addition was affirmed.
S. 36(1)(viia): Bad debt-Provision for bad and doubtful debts-Schedule bank-A co-operative bank, eligible for deduction even if it had no rural branches-Long-term finance-Eligible for deduction under section 36(1)(viii).[S. 36(1)(vii)]
S. 36(1)(iii): Interest on borrowed capital-Working capital loan-Interest-free loans were advanced in earlier years-Interest paid on working capital loan cannot be disallowed.
S. 36(1)(iii): Interest on borrowed capital-Limited scrutiny-Funds invested in short-term deposits-Assessing Officer had travelled beyond the limited scrutiny parameters for which the case was selected-Addition was deleted. [S. 143(3)]
S. 36(1)(iii) : Interest on borrowed capital-Share application money-Sister concern-Disallowance of interest is not justified-Borrowed money–transferred to sister concern. The Assessing Officer was directed to levy interest; however, only for the actual period of the loan, i.e., for one day.
S. 35 : Expenditure on scientific research-Bogus Donation-IMSRF was not notified under section 35(1)(ii), deduction claimed by assessee was disallowed-Reopening of assessment was affirmed.[S.35(1)(ii), 147, 148]