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2019 (2) TMI 1538 - AT - Income TaxDisallowance of Corporate Social Responsibility (CSR) - allowable business expenditure - HELD THAT:- Explanation 2 has been inserted in the section 37 (1) w.e.f. 01/04/15 and is prospective in nature. In our considered opinion amendment by way of Explanation 2 to Sec.37(1) cannot be construed as disadvantage to the assessee in the period prior to the amendment. It is a disabling provision, as set out in Explanation 2 to Sec.37(1), and refers to such Corporate Social Responsibility expenses u/s 135 of Companies Act, 2013 and as such cannot have application for period not covered by this Statutory Provision which itself came into existence in 2013. We draw our support from the decision in case of CIT vs. Vatika Townships Pvt. Ltd. [2014 (9) TMI 576 - SUPREME COURT]. Amendment would not affect allowability of such expenses for the year under consideration, being assessment year 2012-13. It is observed that authorities below rejected claim of assessee only on the ground that Explanation 2 to Sec.37(1) is applicable to year under consideration. Allow grounds raised by assessee. As we have already allowed the said expenses under section 37 (1) for the year under consideration, the alternate claim raised by assessee under section 35AC and 80 G of the Act becomes academic in nature. - Decided in favour of assessee.
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