Tag Archives: Section 37(1)

Foreign traveling expenses of Director Wives Disallowed

By | November 4, 2016

Facts of the case The assessee claimed an amount of Rs. 2,24,204/- as foreign traveling expenses in respect of its Directors’ wives who traveled with the Directors while they were on business tours. The Assessing Officer noted that the assessee had given a note in the auditors report that this expenditure was incurred under the… Read More »

CSR expenditure is allowable business expense : ITAT

By | July 5, 2016

IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR Assistant Commissioner of Income Tax Circle 1(1), Bilaspur ………….…………….Appellant Vs. Jindal Power Limited ……..….…….…Respondent Tanmar, Raigarh 496 107 I.T.A. No.99/BLPR/2012 Assessment year: 2008-09 S. 37(1): Expenditure on Corporate Social Responsibility (CSR), though voluntary, is allowable as business expenditure. Explanation 2 to s. 37(1) inserted w.e.f. 01.04.2015… Read More »

Expenses on eyes is not allowed as business expendtiure

By | December 28, 2015

Issue Whether the expenditure of Rs. 43,600/- on medical treatment of eyes for improving the vision has an element of personal expenditure, and accordingly the expenditure incurred by the appellant on foreign tour for pre- operation investigation relating to his eyes cannot be allowed as business expenditure u/s 37 (1) ? Assessee plead It is… Read More »

Foreign Exchange Loss is allowable expense under Section 37(1): SC

By | November 1, 2015

Section 37(1), read with section 145, of the Income-tax Act, 1961  Subject : Allowability of Business expenditure  Assessment year: 1998-99  Whether expression ‘expenditure’ as used in section 37 may, in circumstances of a particular case, cover an amount which is really a ‘loss’, even though said amount has not gone out from pocket of assessee ?… Read More »

Cars donated to Police Dept is CSR exp hence disallowable under section 37(1)

By | October 14, 2015

Expenditure incurred by car-manufacturer on gifts of cars to State police department was held not an eligible expenditure under section 37(1) as it was found not incidental to carrying on business and there was no commercial expediency in incurring this expenditure IN THE ITAT CHENNAI BENCH ‘B’ (THIRD MEMBER) Hyundai Motor India Ltd. v. Deputy… Read More »

Provision for loss on transit breakage being contingent in nature, not allowable: HC

By | October 10, 2015

In case of assessee, engaged in business of manufacture and sale of India Made Foreign Liquor (IMFL), provision made for transit breakage was to be regarded as liability of contingent nature and as such was not an allowable deduction under section 37(1) HIGH COURT OF DELHI Seagram Distilleries (P.) Ltd. v. Commissioner of Income-tax-III, New… Read More »

Works contract tax deducted by clients is an allowable business expenses

By | October 10, 2015

Whether amount of works contract tax, deducted by various clients of assessee company while making payments to it, was an allowable business expenditure under section 37(1) even though assessee was not able to claim refund of it from respective State Sales Tax Departments ? Held Yes IN THE ITAT BANGALORE BENCH ‘A’ Tellabs India (P.)… Read More »

Subscription fee of golf club paid by Company for director and his family was not allowable expense

By | October 9, 2015

During year, assessee company paid subscription fee for membership of director and his family members to a golf club and claimed deduction of same as revenue expenditure . Assessing Officer treated expenditure as personal expenditure of director and disallowed same Held :- subscription fee paid on behalf of director could not be allowed as expenditure… Read More »

Amount paid for construction of railway underbridge for access to projects of assessee was revenue exp

By | October 6, 2015

Where an area development authority, made payment to Railway for construction of railway underbridge to overcome traffic problem and for creating access of projects undertaken by it, said expenditure was to be allowed as deduction under section 37(1) IN THE ITAT CHANDIGARH BENCH ‘A’ Greater Ludhiana Area Development Authority v. Additional Commissioner of Income-tax BHAVNESH… Read More »

Expenses for Removal of illegal encroachments is revenue Expense

By | August 22, 2015

Expenses for Removal of illegal encroachments Q Whether expenditure to be incurred in removal of encroachments in and around the technical area of the Airport which was necessitated out of safety and security consideration in the normal course of business of authority enjoined with the responsibilities of maintenance and operation of airports all over India is… Read More »

Compounding fee is penalty hence Disallowed

By | August 19, 2015

Q; Whether Compounding fee is penalty and therefore not allowed as business expenditure ? Compounding fee paid by assessee, a land developer to Municipal Corporation on account of deviations from original sanctioned plan was in nature of penalty and therefore would not be allowable as deduction in view of provisions of Explanation to section 37(1) IN… Read More »

Preoperative expenses are Revenue expenses if

By | July 29, 2015

  Question : Whether the Preoperative Expenses are Revenue expenses if company expanded its existing business?   Answer : Where assessee company expanded its existing business and claimed said expenses as pre-capitalisation cost, same was to be treated as revenue expenditure HIGH COURT OF DELHI Commissioner of Income-tax v. SRF Ltd. S. RAVINDRA BHAT AND R.… Read More »