Section 37 judiciary-2

HC allows expense on Foreign Education & Training of Partner related to Business who continued after education

Aswathanarayana & Eswara Vs DCIT (Madras High Court)

Aswathanarayana & Eswara Vs DCIT (Madras High Court) Expenditure incurred by assessee-firm on partner’s foreign education was to be allowed as deduction when such education was directly related to profession carried on by firm – Madras HC Legal Provisions involved Any expenditure not being in the nature of personal expenses of the...

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Public Issue expenses is capital expenditure & not allowable as revenue expense

Tatia Sky Line & Health Farms Ltd. Vs ACIT (Madras High Court)

Tatia Sky Line & Health Farms Ltd. Vs ACIT (Madras High Court) Conclusion: Expenses incurred by assessee for Public Issue was not allowable as revenue expenditure as assessee miserably failed to establish the tenability and truthfulness of its claim that the expenditure was revenue in nature. Held:  Assessee, a public limited company...

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Staff Recruitment Expenses exclusively for the business are allowable

DCIT Vs EIH Associated Hotels Ltd. (ITAT Kolkata)

DCIT Vs EIH Associated Hotels Ltd. (ITAT Kolkata) It is noted that the staff recruitment expenses were incurred only exclusive for the purpose of business and hence allowable expenditure. We note that the expenses on account of employees’ relation expenses to the tune of Rs. 3,78,242/- was incurred for efficient functioning of the busin...

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No section 37 addition for expenses not claimed by Assessee

USG Buildwell Pvt. Ltd. Vs Additional CIT (ITAT Delhi)

USG Buildwell Pvt. Ltd. Vs Additional CIT (ITAT Delhi) The Ld. DR submitted that the disallowance u/s 37 on account of additional payment for purchase of land was righty made as the assessee could not establish his case as the expenditure was incurred without any substantial evidence produced before the Assessing Officer to that effect [&...

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Deduction from sale proceeds by monetary committee from e-auction sale of mineral stock is allowable U/s. 37(1)

M/s. M. Hanumantha Rao Vs ACIT (ITAT Bangalore)

Addition of amount representing 15% of sale proceeds deducted by the Monetary committee from e-auction sale of mineral stock belonging to assessee and which was contributed to Special Purpose Vehicle, as per the direction given by Hon’ble Supreme Court was justified as the same constituted trading receipts in the hands of assessee, but ...

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ITAT explains CSR expenditure Allowability under section 37

Add. CIT Vs Rites Limited (ITAT Delhi)

 Addl. CIT Vs Rites Limited (ITAT Delhi) AO has disallowed claim of the assessee company qua CSR expenditure by misinterpreting the provisions contained under section 37(1) of the Act by observing that since CSR expenditure is not incurred for the purpose of carrying on the business, such expenditure cannot be allowed under the existing ...

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Expenditure on R&D for manufacture of aircrafts to be sold allowable U/s. 37

Hindustan Aeronautics Limited Vs ACIT (Karnataka High Court)

The fact that a certain payment constitutes income or capital receipt in the hands of the recipient is not material in determining whether the payment is revenue or capital disbursement qua the payer. It has further been held that whether a transaction is capital expenditure would have to be determined having regard to the nature of the t...

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Bad Debt cannot be claimed as deduction unless written off in Books

Allu Arvind Babu Vs ACIT (Madras High Court)

Allu Arvind Babu Vs ACIT (Madras High Court) The claim of creation of provision for such expenditure, which is not yet incurred and is only intended to be written off as compensation paid to the land owner for the admitted failure of the Assessee to complete the contract in the manner as agreed between the […]...

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CSR expenses incurred before 01.04.2015 deductible as business expenses

Garden Reach Ship Builders & Engineers Ltd. Vs PCIT (ITAT Kolkata)

The amendment brought about by way of Explanation 2 to section 37 by Finance Act, 2014, was only with effect from 01.04.2015. ITAT held that the amendment in question is not retrospective. Expenditure incurred in CSR in accordance with guidelines issued by the Govt. of India is allowable as a deduction for both A.Y. 2013-14 and A.Y. 2014...

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Foreign Exchange Fluctuations allowable as Revenue Expense- Section 37

DCIT Vs. Coffee Day Global Ltd. (ITAT Bangalore)

DCIT Vs. Coffee Day Global Ltd. (ITAT Bangalore) The issue under consideration is whether foreign exchange fluctuations are allowed as revenue expense u/s 37 of Income Tax Act? ITAT states that, the Supreme Court in the case of CIT vs. Woodward Governor India Pvt. Ltd. (2009) 312 ITR 254 had already held that the actual […]...

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