TMI Blog1993 (2) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... nditure hit by the provisions of section 37(4) of the Act ? (2) Whether, on the facts and circumstances of the case, the Tribunal was justified in law in confirming the disallowance of salary of Rs. 2,100 paid to a pujari holding the same as non-business expenditure ? (3) Whether, on the facts and circumstances of the case, the Tribunal was justified in law in holding that the assessee was not entitled to claim of gratuity liability of Rs. 17,81,503 on various alternative grounds and under various provisions of the Act with special reference to section 28 of the Act ?" As regards question No. 3, the learned advocate appearing for the assessee at the outset conceded that in view of the decision of the Supreme Court in Shree Sajjan Mill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll premises and the pujari was employed in connection with the said temple. The Income-tax Officer disallowed the said claim on the ground that since the company has no soul to invoke the blessings of God by homam and puja, the said expenditure cannot be regarded as business expenditure. The Income-tax Officer also relied upon the decision of the Delhi High Court in CIT v. Bhanna Mat and Co: P. Ltd. [1971] 82 ITR 138, for taking that view. The Appellate Assistant Commissioner and the Tribunal confirmed that view. Thereupon, the assessee moved the Tribunal for referring the above-stated questions. What is contended by learned counsel for the assessee is that the assessee was not maintaining any residential accommodation at Bombay and, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel relied upon the decision of the Punjab and Haryana High Court in Atlas Cycle Industries Ltd. v. CIT [1982] 134 ITR 458. In that case, the assessee had built a temple and the amount given by it by way of grant to the temple for its management and depreciation of the building was claimed as deduction. In that context, the Punjab and Haryana High Court observed as under (at page 465) : "It cannot be disputed that a satisfied worker is a great asset to the business and the satisfaction of the worker not only depends upon the packet which he receives at the end of the month but also on the other amenities provided to him by his employer.... If the workers can overcome their boredom by playing cards in a club, we see no reason for holdin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was claimed as expenditure incurred in furtherance of the assessee's business. The question that was required to be considered was whether expenses of puja of Lord Ganesh can be disallowed under section 37(1) of the Act. What was contended on behalf of the assessee was that it was customary expenditure incurred by the Hindus and, therefore, it was wrong on the part of the Tribunal and the Appellate Assistant Commissioner to hold that it was in the nature of personal expenditure of the assessee and had not been laid out exclusively for the purpose of the business. The Allahabad High Court held that the Appellate Assistant Commissioner and the Tribunal were wrong in holding that such expenditure was personal expenditure. It held that since i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Malayalam Plantations Ltd. [1964] 53 ITR 140 (SC). It then observed that the expenditure incurred for invoking the blessings of Gods and Goddesses for prosperity had no relationship to the carrying on of the business by the assessee. The Delhi High Court held on the facts of that case that it was difficult to hold that the expenditure in question was incurred for the purpose of carrying on the business of the assessee and that the assessee had incurred the same as a businessman. What is required to be noted is that in that case, it was contended on behalf of the assessee that the pujari was employed for invoking the blessings of Gods and Goddesses for the benefit of the assessee. The said expenses were incurred by the assessee because of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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