TaxTMI 
TaxTMI 
2012 (12) TMI 717
X X X X Extracts X X X X
X X X X Extracts X X X X
....ixing his signature on the Grounds of appeal. Accordingly the said ground is dismissed as withdrawn. The other grounds give rise to a single issue viz., whether the Ld CIT(A) is justified in confirming the disallowance of Rs.35,41,700/- relating to the diminution in the value of its current investments made in Government of India securities. 3. In the appeal filed by the revenue, the decision of Ld CIT(A) in deleting the disallowance of staff welfare expenditure is being assailed. 4. The facts relating to the above said issues are stated in brief. The assessee is a non-banking financial company engaged in the business of advancing money on the security of gold. It is also engaged in trading of shares and securities. During the year un....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iminution in the value and claimed the same as expenditure. The Ld A.R further submitted that the assessee has sold the above said security during the year ending 31.3.2009 and has accounted for entire profit (which includes the amount claimed as expenditure during the year under consideration) as its income. Before us the assessee has filed a copy of annual report relating to the financial year 2008-09. In the said annual report, the investment made in the Government of India security is shown as "Current investment" only. The value of the said investment as on 01.4.2008 was shown at Rs.11,81,25,000/-, meaning there by the assessee has further reduced the value during the year ending 31.3.2007 and 31.3.2008. It is not known whether the AO ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... welfare scheme". This tribunal has considered this issue in the assessee's own case relating to the assessment year 2004-05. We extract below the relevant observations made by the Tribunal on this issue:- "12. The last issue relates to the disallowance of contributions made to as well as interest paid on "Staff welfare scheme a/c". The assessee has made contributions in respect of its employees to a scheme named as "Staff welfare Scheme A/c". The amount so contributed by it on behalf of its employees was treated as salary income in the hands of respective employees and income tax was also deducted there on. The amount accumulated in the name of employees were collectively accounted as "Staff Welfare Scheme" and the accumulated balance w....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the outstanding balance. In our view, the collective name "Staff welfare scheme" is akin to the collective name "Sundry creditors". Accordingly the "Staff welfare scheme" can only be taken as a liability (Creditors) account, i.e., the amount payable to each of the employees who have contributed to the said scheme. Instead of keeping the account in each of the employee name, the assessee has aggregated them and shown as under a collective name. The Ld CIT(A) has noted that the assessee pays the accumulated amount outstanding in the name of the retiring employees along with the interest accrued there on at the time of retirement. It is also submitted that the assessee is deducting TDS from such interest payments. It is only possible to id....