The ITAT allowed the assessee's appeal, holding that...

The ITAT allowed the assessee's appeal, holding that contributions made to the unrecognized provident fund and unapproved pension fund were eligible for deduction under the relevant provisions of the Income Tax Act. The High Court upheld the ITAT's decision, ruling that the assessee had rightfully discharged its onus and the expenditure incurred was allowable. Regarding the allowability of expenditure u/s 36(1)(iv) as per Section 37(1), the High Court followed its earlier precedent in CIT vs. Punjab Financial Corporation, contrary to the Delhi High Court's view in Sony India P. Ltd. The court held that its earlier judgment would have binding precedential value over differing views of other High Courts. Furthermore, the court ruled that the liability payable by the assessee on account of electricity duty could be set off by the allotment of equity shares, amounting to discharging the liability u/s 43B. The shares allotted by the Government of Haryana were considered as part of the funds and not acquired from other sources, hence allowable u/s 43B of the Income Tax Act. Consequently, the assessee's appeal was dismissed.