TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Tribunal decision on business expenses, employee contributions, and tax provisions clarified.</h1> <h3>The DCIT, Circle-6, Jaipur Versus M/s Rajasthan Renewable Energy Corporation Ltd.</h3> The DCIT, Circle-6, Jaipur Versus M/s Rajasthan Renewable Energy Corporation Ltd. - TMI Issues Involved:1. Disallowance of contribution to the State Renewal Fund.2. Disallowance for delayed deposit of employees' contribution to PF & ESI.3. Applicability of section 43B vs. section 36(1)(va) r.w.s. 2(24)(x) for employees' contribution to PF & ESI.4. Disallowance of contribution to the Energy Conservation Fund.5. Disallowance of contribution to Rajasthan Bhawan.6. Disallowance of 50% of expenses on Publicity and Advertisement.7. Disallowance of prior period expenditure.8. Disallowance of deduction under section 80IA.Detailed Analysis:1. Disallowance of Contribution to the State Renewal Fund:The Revenue challenged the deletion of the disallowance of Rs. 20,00,000 towards the State Renewal Fund. The Tribunal referred to its own decision in the assessee’s case for AY 2011-12 and the Rajasthan High Court's decision in Principal CIT vs. Rajasthan State Seed Corporation Ltd., which allowed such contributions as business expenditure under section 37(1). The Tribunal affirmed the CIT(A)'s order, dismissing the Revenue's ground.2. Disallowance for Delayed Deposit of Employees' Contribution to PF & ESI:The Revenue contested the deletion of the disallowance of Rs. 8,60,731 for late deposit of employees' contributions to PF & ESI. The Tribunal noted that the contributions were paid before the due date for filing the return under section 139(1). Citing various High Court decisions, it affirmed the CIT(A)'s order, dismissing the Revenue's ground.3. Applicability of Section 43B vs. Section 36(1)(va) r.w.s. 2(24)(x):The Tribunal addressed whether employees' contributions to PF & ESI are governed by section 43B or section 36(1)(va) r.w.s. 2(24)(x). It upheld the CIT(A)’s view that section 43B applies, dismissing the Revenue's ground.4. Disallowance of Contribution to the Energy Conservation Fund:The Revenue disputed the deletion of Rs. 1,00,00,000 towards the Energy Conservation Fund. The Tribunal referred to its decisions in the assessee’s own case for AY 2008-09 and AY 2012-13, where such contributions were allowed as business expenditure. It affirmed the CIT(A)'s order, dismissing the Revenue's ground.5. Disallowance of Contribution to Rajasthan Bhawan:The assessee challenged the CIT(A)'s direction to the AO to re-examine the disallowance of Rs. 1 crore for Rajasthan Bhawan. The Tribunal noted that the Government of Rajasthan provided a 75% rebate on room tariffs for contributors. Following its decision in RIICO Ltd. for AY 2012-13, it allowed the expenditure under section 37(1), directing the AO to allow the claim.6. Disallowance of 50% of Expenses on Publicity and Advertisement:The assessee contested the disallowance of 50% of Rs. 57,98,634 on publicity and advertisement. The Tribunal remanded the matter to the AO to verify the details of the expenditure after providing the assessee an opportunity to furnish the necessary details, allowing the ground for statistical purposes.7. Disallowance of Prior Period Expenditure:The assessee challenged the disallowance of Rs. 2,33,005 out of Rs. 3,71,601 as prior period expenditure. The Tribunal noted that the expenditure was booked after approval from the competent authority and allowed the claim, directing the AO to allow the same.8. Disallowance of Deduction under Section 80IA:The assessee disputed the reduction of its deduction claim under section 80IA by Rs. 10,63,92,647. The Tribunal referred to its decision for AY 2011-12, directing the AO to verify the revised working submitted by the assessee, which allocated indirect expenses proportionately. It set aside the matter to the AO for verification, allowing the ground for statistical purposes.Conclusion:The Tribunal dismissed the Revenue's appeal and partly allowed the assessee's appeal for statistical purposes, directing further verification by the AO on certain issues.
TaxTMI 