TaxTMI 
TaxTMI 
2003 (10) TMI 39
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....iness of providing long-term finance for construction or purchase of houses in India for residential purposes. The petitioner commenced business during the end of 1994 and its first year of business ended on March 31, 1995. The petitioner has filed the memorandum and articles of association in terms of annuxure A with regard to its business of providing long-term finance for construction or purchase of houses in India for residential purposes. The Income-tax Act provides for substantial concession in terms of section 36(1)(viii) of the Act with regard to the special reserve created and maintained by a public limited company founded and registered in India with the object of carrying on the business of providing long-term finance for cons....
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.... Dr. R.B. Krishna, learned counsel for the petitioner invited my attention to the history of the case to contend that injustice has been meted out to his client. Learned counsel says that no specific norms as such were published, and without application of mind the petitioner is found fault with for noncompliance of the terms. He says that for the subsequent years, the approval has been granted. His further submission is that mere grant of approval does not by itself provide the benefits, and that the Assessing Officer is always at liberty to look into the object for the purposes of concession. Sufficient safe-guards are available according to learned counsel in terms of the Act. Learned counsel strongly relies on a judgment of the Supreme....
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....of this clause: Provided further that where the aggregate of the amounts carried to such reserve account from time to time exceeds twice the amount of the paid-up share capital and of the general reserves of the corporation or, as the case may be, the company, no allowance under this clause shall be made in respect of such excess: Explanation.--In this clause,- (a) 'financial corporation' shall include a public company and a Government company; (b) 'public company' shall have the meaning assigned to it in section 3 of the Companies Act, 1956 (1 of 1956); (c) 'Government company' shall have the meaning assigned to it in section 617 of the Companies Act, 1956 (1 of 1956); (d) 'infrastructure facility' shall have the meaning ....
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....y way of objections, a bald answer has been given to the effect that approval was granted only after ensuring that the norms have been fulfilled. It is also necessary at this stage to notice as to whether the norms are absolutely necessary for the purpose of approval in terms of section 36(1)(viii) of the Act. The Supreme Court in the case of CIT v. Sirpur Paper Mills [1999] 237 ITR 41 has considered the scope of providing deduction in terms of the Income-tax Act. The court was considering the norms in these matters. The Supreme Court while considering somewhat similar notification dated October 21, 1995, has ruled that the condition of 80 per cent. of the amount actually paid by the employer can be allowed as deduction in terms of the s....