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Income Tax Appellate Tribunal, HYDERABAD BENCHES “A” : HYDERABAD
Before: SHRI S.S.GODARA & SHRI LAXMI PRASAD SAHU
O R D E R PER S.S.GODARA, J.M. :
This assessee’s appeal for AY.2011-12 arises from the CIT(A)-5, Hyderabad’s order dated 31-05-2017 passed in appeal No.0620/2014-15/CIT(A)-5, in proceedings u/s.143(3) of the Income Tax Act, 1961 [in short, ‘the Act’]. Heard both the parties. Case file perused.
The assessee’s former substantive grievance challenges correctness of the CIT(A)’s action affirming the assessment findings disallowing its 10% of the salary costs of Rs.16,04,08,137/- coming to Rs.1,60,40,813/-. Both the parties fails to dispute before us that neither the assessee has been able to prove each and every head of salary expenditure by filing all the details of the employees concerned nor the learned lower authorities have considered the issue of such employees cost being normal in the course of assessee’s stock broking business on day-to-day basis. Faced with this situation, we deem it appropriate that a lumpsum 5% disallowance than 10% in issue would be just and proper with a rider that the same cannot be taken as a precedent in any other case. Ordered accordingly. The assessee gets part relief in above terms.
Next comes depreciation disallowance of UPS to the tune of Rs.8,45,158/- claimed @60% as against 15% granted in both the lower proceedings. We find that hon’ble Delhi high court’s recent decision and 1267/2010 in CIT Vs. BSES Yamuna Powers Ltd., dt.31st August, 2010 holds that ‘UPS’ forms part of the computer system and is eligible for 60% depreciation. We adopt the very reasoning herein as well and direct the Assessing Officer to delete the impugned disallowance. Necessary computation to follow as per law.