Vend fee paid by assessee to Government, even if of the nature of ‘privilege fee’ falls within the expression ‘fee by whatever name called’

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1. R.Karthikeyan says:

   The judgement of Apex Court has come in the right time but squarely opposite to its own court’s judgement in the case M/s. Mc Dowell & Co Limited (314 ITR 167). The previous order may be based on the facts of the case that the vend fee levied by Kerala State Government is with a specific purpose of purchasing machinery to the assessee company itself but in the later decision, the facts might be different. The Hon’ble Apex Court’s decision in the case of M/s. Bharat Earth Movers (245 ITR 428) that if a business liability definitely arisen in the previous year should alone be allowed which may be discharged at a later date is also to be kept in mind. The recent amendment in section 40(b)(iib) that the privilege fee is not a allowable deduction w.e.f 1.4.2014 needs attention with the above decisions.

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   June 24, 2015 at 11:46 pm
2. R.Karthikeyan says:

   The judgement of Apex Court has come in the right time but squarely opposite to its own court’s judgement in the case M/s. Mc Dowell & Co Limited (314 ITR 167). The previous order may be based on the facts of the case that the vend fee levied by Kerala State Government is with a specific purpose of purchasing machinery to the assessee company itself but in the later decision, the facts might be different. The Hon’ble Apex Court’s decision in the case of M/s. Bharat Earth Movers (245 ITR 428) that if a business liability definitely arisen in the previous year should alone be allowed which may be discharged at a later date is also to be kept in mind.

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   June 24, 2015 at 11:41 pm
3. Priya says:

   Thanks!!

     Reply

   June 18, 2015 at 11:48 am
4. CA Piyush Akkarbote says:

   Nice interpretations.

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   June 18, 2015 at 11:26 am