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2022 (1) TMI 1263 - AT - Income TaxDisallowance u/s 14A - assessee has received dividend from UTI Treasury Advantage Fund under Institutional Plan Scheme - HELD THAT:- Since, the funds have been utilized for investment without incurring any expenses and keeping in view the evidences submitted by the assessee that no expenditure has been incurred for investment, no disallowance u/s 14A is called for. The appeal of the assessee on this ground is allowed. Claim of CSR expenditure - allowable business expenditure or not? - HELD THAT:- As on going through the entire facts of the case since, the amendment to Section 37(1) of the Act was inserted in Finance Act 2015 and is not retrospective, this expenditure is hereby allowed to be claimed as business expenditure u/s 37(1). Education Cess allowability - whether education cess is not tax and is an allowable expenditure? - HELD THAT:- Education Cess is not of the nature described in sections 30 to 36, Education Cess is not in the nature of capital expenditure, Education Cess is not personal expense of the Assessee, it is mandatory for it to pay Education Cess and for the purpose of computation of Education Cess, the Income ‘Tax’ is taken as the criteria for computational purpose. Thus, the expense of Education Cess is mandatory expenses to be paid but does not fall under capital expense and personal expenditure and hence may be allowed as deduction. We have also gone through the various judgments of judicial authorities pan India wherein the fresh claim of the assessee is considered and the deduction u/s 37 of Education Cess has been allowed. The Hon’ble High Court of Bombay held [2020 (3) TMI 347 - BOMBAY HIGH COURT] that the appellate authorities may confirm, reduce, enhance or annul the assessment or remand the case to the AO, because the basic purpose of a tax appeal was to ascertain the correct tax liability in accordance with the law. Hence, keeping in view the provisions of the Act pertaining to Section 40(a)(ii) and Section 115JB, Circular of the CBDT No. 91/58/66ITJ(19) we hereby hold that the assessee is eligible to claim the deduction of the ‘Education Cess’ as per the provisions of Section 37 of the Income Tax Act. - Decided in favour of assessee.
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