1979 (11) TMI 88

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....tax Appellate Tribunal has referred the following question of law for opinion of this court : " Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that section 41(1) of the Income-tax Act, 1961, is not attracted to this case ? " The facts necessary for answering this question may be shortly stated. The assessee had paid....

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....he ITO included the amounts refunded in the income of the assessee in the respective years. The appeal filed by the assessee succeeded and the revenue's appeal filed before the Tribunal failed. The question that arises is as to whether this amount constituted the assessee's income in view of s. 41(1) of the Act. Section 41(1) of the Act runs as under : " 41.(1) Where an allowance or deductio....

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....2 ITR 363, the Supreme Court held that sales tax is a business expenditure allowable under s. 37 of the Act. Thus, the amounts which the assessee had, either debited in its books or paid for sales tax, constituted business expenditure. The assessee had been granted a deduction for this expenditure. Section 41(1) provides for inclusion of any amount which has been allowed as a deductible expenditur....