S. 36(1)(vii) : Bad debt-Bad debt-Doubtful debts-7.5 Per Cent. of total business income plus 10 Per Cent. of average rural advances-Provision for bad and doubtful debts-Direction to AO to consider the claim. [S. 36(1)(viia)]

S. 36(1)(iii) : Interest on borrowed capital-Funds diverted for equity infusion of associated concerns-Disallowance of interest is held to be justified.

S. 32 : Depreciation-Purchase Bills for certain assets not genuine-Assessee and department agreeing for one lakh disallowance-Depreciation is allowable on balance purchases.

S. 32 : Depreciation-Securities-RBI guidelines-Depreciation on valuation of Securities allowable as business loss. [S. 28(i)]

S. 28(i) : Business income-Civil contractor-Transfer of development rights-Income earned from project assessable as business income-Estimation of 10% of gross receipts is held to be justified-When income is estimated specific disallowance u/s. 40A(3) cannot be made-The transfer definition cannot be applied to on transfer development rights which is a business asset-Income taxable on performing certain obligations [S. 2(47)(v), 40A(3), Transfer of Property Act, 1882, S.53A]

S. 28(i) : Business income-Ancillary objects-Financial services-Assessable as business income. [S. 37(1), 57(3)]

S. 14A : Disallowance of expenditure-Exempt income-Shares held as stock in trade-Disallowance is held to be not justified. [R. 8D]

S. 14A : Disallowance of expenditure-Exempt income-No exempt income-Disallowance cannot be made. [R. 8D]

S. 14A : Disallowance of expenditure-Exempt income-Investments held as Stock In Trade cannot be subject matter of disallowance-Strategic investments yielding exempt income alone to be considered for purpose of working of disallowance. [R. 8D(2)(iii)].

S. 14A : Disallowance of expenditure-Exempt income-Investment was made in earlier year-No interest expenditure was claimed-Matter remanded to the AO for fresh consideration. [R. 8D]