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2012 (8) TMI 85 - AT - Income TaxWhether compensation paid to the land owners for using their land for extraction of Gypsum; mining being part of the assessee’s trade, as revenue expenditure – Held that:- Nature of loss in the hands of the payee would be of little consequence in determining the nature of the expenditure in the hands of the payer/person incurring the expenditure - expenditure is revenue in nature - in favour of the assessee Disallowance - contribution to a Fund established at the instance of the State Government with the object of providing a safety net for the workers - disallowance by the Assessing Officer on the basis that the same is only an application of income and not a case of diversion of income by overriding title – Held that:- Fund had been set up solely for the purpose of welfare and benefit of the employees - disallowance deleted - in favour of the assessee Donation versus business expenditure - Contribution to the welfare fund as a precondition for the grant of export permits - business expediency – Held that:- Most business payments arising only out of conscious business decisions on the part of the Management, whose function and responsibility and, thus, prerogative, it is to decide as to how to conduct the same; the only requirement of law being a clear exhibition of the same being motivated by considerations only of business - assessee’s claim as not sustainable
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