TaxTMI 
TaxTMI 
2012 (11) TMI 712
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....turn of income on 23.10.2006 declaring a total income of Rs.1,01,293/- after allowing exemption u/s.10A. The assessing officer completed the assessment by making the following additions. a) An amount of Rs.1,91,853/- paid as ROC fees for increasing the authorized share capital was treated as capital expenditure and it was held that this expenditure to be amortized over a period of 5 years. Therefore only an amount of Rs,38,370.0 was allowed and the balance of Rs.1,53,483/- was disallowed. b) An amount of Rs.16,62,151/- was disallowed u/s.40(a)(ia) since TDS was not remitted into the Government account before the due dates. The TDS had been deducted on professional charges and the payments to contractors. c) The deduction claimed u....
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....ication charges incurred in convertible foreign exchange from the export turnover, the Hyderabad Bench of the Tribunal in M/s.Prithiv Information Solutions Vs ITO (supra) and ITO Vs D.E.Block India Software Pvt Ltd (supra) has consistently taken the same view with regard to exclusion of charges incurred in foreign exchange for the purposes of computing eligible deduction u/s.10A/10B of the Act. In these decisions, the view taken has been that the amounts incurred inconvertible foreign exchange have to be excluded from the total turnover also if it has been excluded from the export turnover. Following these decisions, I hold that the telecommunication charges of Rs.11,26,285/- which have been excluded from the export turnover by the assessin....
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.....38,370/-. However, the Supreme Court in Punjab State Industrial Development Corporation Ltd VsCIT (225ITR 792) of Brooke Bond India Ltd Vs CIT (225 ITR 798) has held that expenditure in the form of ROC fees for increase in share capital is capital in nature and not an allowable expenditure. In fact the entire expenditure is disallowable and the amount o fRs.38,370/- allowed by the Assessing officer is also to be disallowed. The appellant is also not entitled to claim the balance expenditure over the next 4 years. The Delhi High Court in the case of CIT Vs Hindustan Insecticides Ltd (250 ITR 338) has held that this expenditure is capital in nature and cannot be considered as falling within the purview of sec.35(2)(c)(iii) of the Act. The....
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....id decision cited supra the issue is decided in favour of the assessee and ground of appeal of the revenue in this regard is dismissed. 9. With regard to the disallowance of Rs.16.62,151/- u/s.40(a)(ia) holding that they are already paid, with out verifying the books of accounts. Again the issue is covered by the decision of the Vizag Special bench in the case of M/s Merlyn Shipping Transport & Others, 136 ITD 23(SB)(Vizag) wherein it was held as under:- "When s. 40(a)(ia) was proposed to be inserted by the Finance Bill 2004, it applied to any "amount credited or paid". However, when enacted by the Finance Act 2004, it applied only to "amount payable". The words "credited/ paid" and "payable" have different connotations and the lat....