TaxTMI 
TaxTMI 
2013 (5) TMI 858
X X X X Extracts X X X X
X X X X Extracts X X X X
....r of Income-tax, Ranchi has erred by giving direction to reduce the el igible amount under section 115JB by an amount of ₹ 78 Lakh, however on one side, he conf irmed the same addit ion made by the Assessing Of ficer amount ing to total ₹ 78 lakh on fol lowing heads: A. ITDS Cert i ficate Receivable at ₹ 12.19 Lakh. B. Booking of Earnest Money Deposi t wi th Clients at ₹ 40.62 Lakh. C.Rs.25.19 Lakh for Sof tware Expenses. 2. That the Ld. Commissioner of Income-tax, Ranchi has erred by al lowing disal lowance of claim of unabsorbed depreciation to the extent of ₹ 16,59,64,100/- without taking into considerat ion the justi fication of addi tion made by the Assessing Of ficer." 3. Brief facts relating to grou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....), the CIT(A) al lowed the claim of the assessee. 6. We heard the rival submissions and carefully considered the same. We noted that the unabsorbed depreciated has to be allowed, while computing the el igible profi t under sect ion 115JB. The assessee was having a loss amount ing to ₹ 265,13,33,852/- and as unabsorbed depreciation of ₹ 16,59,64,000/-, lower of the two was the unabsorbed depreciation which has been claimed by the assessee as deduction. We do not find any i llegal ity and infirmi ty in the order of the CIT(A) in delet ing the said addi tion. Thus, the ground no.2 of the Revenue stands dismissed. As a result , the appeal fi led by the Revenue stands dismissed. ITA No.05/Ran/2013 7. Ground nos. 1 and 2 taken by t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of mercant i le account ing as well as defini tion of the accrual given under clause 6, we are of the view that since the TDS certificate wri tten off did not relate to the period i .e. account ing year 2006-07, therefore, we do not find any il legali ty or infirmi ty in the order of the CIT(A) in sustaining the disallowance. Thus, the ground nos. 1 and 2 stand dismissed. 9. Ground nos. 3 and 4 taken by the assessee in i ts appeal relate to the disallowance of the earnest money deposi ts wi th the cl ient amounting to ₹ 40.62 lakhs wri tten off during the year. The Assessing Officer disallowed the said amount as it has been booked by the assessee under the head 'prior period expenses'. When the matter went before the CIT(A), the CIT....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sing Officer to allow the depreciat ion to the assessee. 12. Before us, the ld. A.R. vehement ly contended that the expenses incurred relates to the upgradation of the software like NSPAM forward MS Windows XP Professional OEM CAD work x plant profession 2006 PC El i ta version 2006 software etc. This is not an expendi ture which relates to the software being bought for the first t ime. This is basical ly an expendi ture for upgradat ion of the software. The expendi ture for the upgradat ion of the computer software cannot be regarded to be the capital expenditure. In this regard, due to technical changes, the l ife of the software is not certain and whatever an individual software creates, old software has to be upgraded. The ld. D.R. , o....