Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (1) TMI 485 - AT - Income TaxContribution to education fund - application of income or diversion of income by overriding title - whether the amount is not allowable as deduction? - Held that:- The amount contributed by assessee to the National Cooperative Union, New Delhi is appropriation from the net profits. There is a right to receive the income independent of accrual and receipt of income by the assessee before third party could lay claim to any part of it. Since income reached assessee before it reached to a third party, there is no diversion. As already stated, there is no payment in the year of losses. Therefore, payment under section 63(1)(b) of the multistate co-operative societies act 2002 is only an appropriation of profit. Moreover, this amount paid during the year is also not out of the profits of this year but profits of earlier year. Therefore, on that count also amount cannot be allowed as deduction during the year. For these reasons, we uphold the order of the authorities and reject assessee’s grounds on the issue. In the result, appeal of the assessee is dismissed.
|