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TMI Blog2007 (3) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee's claim regarding interest due on sticky loans? 2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that deduction under section 36(1) (viii) of Income-tax. Act, 1961, should be allowed @ 40% of the total income before making deduction u/s 36 (1) (viii) itself? 3. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in deleting the disallowance of Rs.29402/- representing contribution made by the assessee corporation towards the Provident Fund Act, 1925" 2. As far as questions No.1 and 2 are concerned, much facts are not required to be stated as learned counsel for the revenue has fairly conceded that the issues are co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The order of Commissioner of Income-tax (Appeals) was upheld by the Tribunal. While doing so both the authorities below had relied upon the order passed by it in the case of Haryana Financial Corporation. The status of that case is not readily available with the counsel for the revenue. However, we have examined the case independently and are of the view that the opinion expressed by the Tribunal in the case is in conformity with law even though detailed discussion is not available on record. 5. Sections 30 to 36 of the Act provides for various deductions which are available while computing income from business and profession. Section 37 is a general Section which provides for deduction of any expenditure not included in any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e judgment in High Land Produce Co. Ltd.'s case (supra) of the Kerala High Court, the proposition was summed up as under : "Considering the aforesaid judgments and the provisions of sections 30 to 36 and 37, it can be held that : (a) section 37 is required to be construed liberally; (b) section 37 is of general nature and it operates in a wide range covering all expenditure laid out or expended wholly and exclusively for the purposes of the business or profession, which expenditure is not capital in nature or personal expenses of the assessee; (c) it may take into account not only the day-to-day running expenses of a business but also the rationalisation of its administration and modernisation of its machinery; it may include measures f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pense was made wholly and exclusively for the purpose of business and was neither capital in nature nor personal expense of the assessee. Section 36 (1)(iv) of the Act does not debar specifically deduction on account of contribution made under the Provident Fund Act, 1925. It only talks about grant of deduction in respect of recognized provident fund. Keeping this in view, we do not find that any illegality has been committed by the Tribunal in rejecting the appeal of the revenue sustaining the deletion of disallowance of Rs. 29,402/- representing contribution made by the assessee towards provident fund. 8. Accordingly, question No.3 is also answered against the revenue and in favour of the assessee. 9. The reference is disposed of, accor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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