https://www.taxtmi.com/caselaws?id=367062 The Delhi HC ruled on multiple tax issues. Regarding deemed dividend under Section 2(22)(e), the court held that companies conducting multiple non-banking financial activities cannot apply the 50% substantiality test, deciding against revenue. For provident fund and ESI contributions under Section 43B, the court ruled that payments within the prescribed grace period (15+5 days for EPF, 21 days plus grace for ESI) qualify for deduction, with the assessee entitled to relief under Section 36(1)(va). The revenue's appeal was partly allowed. Concerning revenue expenditure for hotel construction, the court upheld the 75:25 capital-to-revenue ratio treatment and confirmed salary payments as revenue expenditure. For interest on borrowed funds used for infrastructure development in A.Y. 2000-01, the court applied India Cements precedent, ruling no distinction exists between different expenditure types for borrowed funds. All decisions favored the assessee except the partial allowance on provident fund timing issues. en-us Thu, 06 Sep 2018 00:00:00 +0530 Mon, 21 Jul 2025 13:14:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=367062 The Delhi HC ruled on multiple tax issues. Regarding deemed dividend under Section 2(22)(e), the court held that companies conducting multiple non-banking financial activities cannot apply the 50% substantiality test, deciding against revenue. For provident fund and ESI contributions under Section 43B, the court ruled that payments within the prescribed grace period (15+5 days for EPF, 21 days plus grace for ESI) qualify for deduction, with the assessee entitled to relief under Section 36(1)(va). The revenue's appeal was partly allowed. Concerning revenue expenditure for hotel construction, the court upheld the 75:25 capital-to-revenue ratio treatment and confirmed salary payments as revenue expenditure. For interest on borrowed funds used for infrastructure development in A.Y. 2000-01, the court applied India Cements precedent, ruling no distinction exists between different expenditure types for borrowed funds. All decisions favored the assessee except the partial allowance on provident fund timing issues. Case-Laws Income Tax Thu, 06 Sep 2018 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=367062