| |
| The Tax Publishers2019 TaxPub(DT) 6095 (Karn-HC) : (2019) 418 ITR 0410 : (2019) 310 CTR 0617 : (2020) 269 TAXMAN 0170 INCOME TAX ACT, 1961
Section 37(1)
It required to be noticed that assessee was carrying business of iron ore. Thus, day in and day out, assessee would be approaching appropriate Government and its authorities for grant of permits, licenses and as such assessee in its wisdom and prudence had entered into MOU with Government of Karnataka and incurred expenditure towards construction of houses for needy persons, not only out of social responsibility but also keeping in mind the goodwill and benefit it would yield in long run in earning profit which is the ultimate object of conducting business and as such, expenditure incurred by assessee was in the realm of 'business expenditure' and was alloweded under section 37(1).
|
Business expenditure - Payment made towards construction of 169 houses for villagers who had lost their homes due to natural calamity - Business prodence -
Assessee claimed deduction of amount paid towards construction of 169 houses for villagers who had lost their homes due to natural calamity. AO held the same to be non-business expenditure.Held: It required to be noticed that assessee was carrying business of iron ore. Thus, day in and day out, assessee would be approaching appropriate Government and its authorities for grant of permits, licenses and as such assessee in its wisdom and prudence had entered into MOU with Government of Karnataka and incurred expenditure towards construction of houses for needy persons, not only out of social responsibility but also keeping in mind the goodwill and benefit it would yield in long run in earning profit which is the ultimate object of conducting business and as such, expenditure incurred by assessee was in the realm of 'business expenditure' and was allowed under section 37(1).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : A.Y 2011-12 & 2012-13
IN THE KARNATAKA HIGH COURT
 SUBSCRIBE FOR FULL CONTENT
|