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2022 (12) TMI 335 - AT - Income TaxDisallowance of Capitalization of CENVAT credit on capital goods - assessee is a nationalized bank in which majority of the shares are held by Central Government - whether CENVAT credit cannot be capitalized and no depreciation on the same can be claimed? - Appellant bank charged off 50% of the CENVAT credit as per the provisions of the Finance Act. 1994 - HELD THAT:- As identical issue came up for consideration in assessee’s own case in Assessment Year 2015-16 2022 (3) TMI 1131 - ITAT BANGALORE holding that unutilized CENVAT credit has to be capitalized to the cost of the Asset in relation to which the CENVAT credit became available to the assessee, the Revenue authorities were justified in rejecting the claim of the assessee for deduction on account of unutilized CENVAT credit which was claimed as deduction in computing income from business of the assessee. Consequently, ground No.2 raised by the assessee is dismissed. Disallowance paid to Corporation Bank Economic Development Foundation u/s 37 - HELD THAT:- provisions of section 37(1) and 80G of the Act are not mutually exclusive if the contribution by the assessee in the form of donation of the category specified in section 80G of the Act but if it could be termed as an expenditure of the category falling under section 37(1) of the Act, then the right of the assessee to claim the whole of it as allowance under section 37(1) of the Act cannot be denied but such money must be laid out wholly or exclusively for the purpose of business. The decision of the Hon’ble Calcutta High Court in the case of CIT Vs. Eastern Coalfields Ltd. 2022 (11) TMI 982 - CALCUTTA HIGH COURT where Government of India framed guidelines on corporate social responsibility for central public sector enterprises, such public sector is bound to formulate a policy in terms of the said guidelines and if an obligation springs from complying with the said guidelines, it has to be regarded as expenditure incurred on grounds of commercial expediency and allowed as a deduction. Therefore the expenditure in question, on the facts of the present case, satisfies the requirements of Sec.37(1) of the Act. In view of the facts and circumstances of the given case, we are of the view that the deduction claimed by the assessee should be allowed in full. We hold and direct accordingly and allow ground No.3 raised by the assessee. Deduction u/s 36(1)(vii) on account of Bad Debts written off - Additional claim made by the Appellant Bank u/s 36(1)(vii) & 36(1)(viia) at the time of Assessment proceedings by holding that it is an alternate ground - HELD THAT:- Since the CIT(A) has not rendered any decision on ground No.5, the parties prayed that the issue may be set aside to the CIT(A) for fresh adjudication. Accordingly, ground No.4 in this appeal is set aside to CIT(A) for consideration afresh after giving due opportunity of being heard to the parties.
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