Case Law Details
ZF Steering Gear (India) Ltd. Vs DCIT (ITAT Pune)
ITAT Pune held that lease rent paid for acquiring mining rights is capital in nature and hence deduction against the same is not allowable.
Facts- Return of the assessee was assessed and vide order passed u/s 143(3) various disallowances were made. Being aggrieved by the disallowances, an appeal was filed before CIT(A), who vide impugned order confirmed addition u/s 14A and also confirmed the disallowance of claim for allowance of balance of additional depreciation in the subsequent assessment year. However, CIT(A) held that the subsidy received by the appellant company from the Government of Maharashtra under Package Scheme of Incentive, 2007 is capital in nature, but directed AO to reduce the same from the actual cost of the depreciable asset for the purpose of allowing the depreciation. CIT(A) also confirmed the addition on account of amortization of leasehold premium paid.
Being aggrieved by the decision of the ld. CIT(A), the appellant is in appeal before us in the present appeal.
Conclusion- We find merit in the contention the appellant that for the purpose of computation of amount of disallowance under Rule 8D(2)(iii), the value of such investments which yielded exempt income alone has to be considered.
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