Yogesh G. Shah
B.Com., L.L.B., F.C.A.
Assessment year 1991-92, Order dated 31st July, 2000
Biswakarma puja is a necessary event which is to be performed by the employees working in the printing press and,
therefore, the expenditure cannot be said to have been incurred for non-business purposes and same is deductible.
Employee's contribution to provident fund etc. is deemed to be income of assessee-employer and consequently there is a
corresponding liability to contribute the same to the provident fund. Therefore, clause (b) of section 43B is applicable and the
contribution if not paid or deposited within due dates are to be disallowed.
Assessment year 1987-88, Order dated 18th December, 2000
Prior period adjustment in this case are having net credit
results in the current year and this being so, no addition is
really warranted on this issue.
No disallowance on account of personal expenses can be made
in the case of limited companies and hence disallowance out of
telephone expenses deleted.
Assessment year 1988-89 & 1989-90, Order dated 6th August, 1999
When assessee is conducting trial runs only and no manufacture, purchase or sale takes place expenses incurred are allowable or
sale takes place expenses incurred are allowable as deduction ?
Whether on the above facts depreciation and investment allowance are admissible ?
There was no commercial activity during the relevant previous year. It was stated in Director's report that plant has not fully
gone into commercial production nor the assessee was engaged in trading activity. It was only conducting trial runs for a short
period. There was no manufacture, purchase or sale of finished goods. Expenses incurred by assessee not allowable as deduction.
Investment allowance is admissible when the plant and machinery owned by the assessee is wholly used for the purpose of
business carried on by him. Business implies continuous activity in carrying on a particular trade or a vocation. Assessee was
only conducting trial runs and no commercial activity is carried on and therefore, depreciation and investment
allowance are not admissible.
Assessment year 1986-87, Order dated 28th February, 2000
The provisions of section 80AB are clearly attracted in
relation to computation of deduction allowable under any of the provisions appearing in Chapter VI-A including deduction
allowable under section 80HHC. Section 80B(5) defined "gross total income" which means total income computed in accordance
with the provisions of this Act before making any deduction under VI-A. Therefore, investment allowance has to be reduced before
allowing deduction u/s. 80HHC of the Act.
Assessment year 1990-91 to 1993-94, Order dated 29th October, 1999
Deduction u/s. 801 is allowable only in respect of profits derived from the industrial undertaking. Interest income
derived by investing money in banks, be it out of borrowed money or otherwise, is an independent source of income and not an
income derived from industrial undertaking. Similarly, income from commission is an independent source of income. Therefore,
interest and commission income are not to be taken into account for computing deduction u/s 801.
Assessment Year 1993-94, Order dated April 18, 2000
Whether gain received as above is a capital receipt ?
Whether gain received as above is a capital receipt
Whether gain can be treated as causal receipt u/s 10(3) of
the Income-tax Act ?
When foreign exchange was obtained not in course of trading
but for the purpose of allotment of equity, fluctuation gain would be a capital receipt and not a revenue receipt.
Section 10(3) not being a charging provision; it is impermissible to bring to tax under section 10(3) of the
Income-tax Act. When such receipt was capital receipt, it was wrong to treat it as income in hands of assessee and bring it to tax under
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