TMI Blog2021 (2) TMI 736X X X X Extracts X X X X X X X X Extracts X X X X ..... maintains a school in the name of Star Paper Mill Higher Secondary School in its own mill compound and as well as expenses are meant for the maintenance of the school as well as play ground etc. which are for the welfare of the children of the mill workers as well as to the local residents have not been controverted by the authorities below. Since such similar claims made by the assessee for maintenance of school has not been disallowed in the earlier years, so by applying principle of consistency we direct the AO to allow the expenditure claimed by the assessee. Expenditure u/s 43B on the payment basis - payments in respect of entry tax on fuel kept under advance account in the balance sheet - HELD THAT:- The entry tax levied by the Gov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion made to Star Shiksha Samity which runs a school in the Mills compound of the appellant for education and welfare activities of the children of the employees. 3. The facts of the case is that AO noted that from the details of staff welfare expenses (others) filed by the assessee that a sum of ₹ 1,00,000/- has been paid to Star Shiksha Samity which according to AO is in the nature of donation and liable to be disallowed. On appeal, the Ld. CIT(A) confirmed the action of AO by holding as under: 6.1. I have considered the submission of the A.R of the appellant along with the assessment order. As far as the Act is concerned expenditure of such nature should come within the ambit of Section 80G or section 37 of the Act. I find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the casual/temporary staff and also for carrying out some welfare activities like celebration of festivals, independence day, republic day etc. Since the school is located in the Mills compound itself, children of many employees of the appellant are students of the school. Hence, it can be said that the amount paid by the Appellant to Star Shiksha Samity was used by them for the welfare of the school and children of its employees. We pray that the amount should not have been treated as donation by the AO but as expenses incurred by the Appellant for the benefit of its employees and were allowable u/s 37 as expenses incurred for the welfare of the employees. 6. The Ld. D.R supported the action of the Ld. CIT(A) and does not wan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... education of the children of the workers as well as to the children of the local areas and this can be even termed as part of the Corporate Social Responsibility (CSR) and therefore, it has to be allowed. According to Ld. A.R. the amendment in the scheme of Section 37(1) of the Income Tax Act, 1961 (hereinafter referred to as the Act) which has been introduced w.e.f 01.04.2015 cannot be construed as to the disadvantage to the assessee in the period prior to this amendment. According to him, this disabling provision, as set out in Explanation 2 to Section 37(1) refers only to such corporate social responsibility expenses as under section 135 of the Companies Act, 2013, and, as such, it cannot have any application for the period not covered b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d grounds it is understood that this claim was not made by the assessee in the return of income and not before the lower authorities and this is for the first time the assessee has claimed this expenditure u/s 43B of the Act on the payment basis. 10. According to Ld. A.R this amount claimed by the assessee of ₹ 46,44,362/- was shown as advance in the balance sheet as on 31.03.2012 pertaining to this AY 2012-13. According to Ld. A.R this amount was paid as entry tax [UP Tax on entry of goods into the local areas, 2007]. The assessee challenged the Constitutional validity of this State Act by filing writ petition before the jurisdictional High Court in Writ Tax No. 1484 of 2007. In compliance with the Hon ble High Court interim order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstitutional validity of the State Legislature imposing Entry Tax, the assessee is claiming as deduction the amount paid to the tune of ₹ 46,44,362/- to the UP State Government. It is noted that since the assessee had challenged the Constitutional validity of the entry tax in Hon ble High Court/Supreme Court the assessee had not claimed deduction of entry-tax paid to UP Government in its return of income, but showed it as Advance in the Balance-Sheet as on 31.03.2012. However since the Hon ble High Court has upheld the Constitutional validity of the legislation, the assessee intends to claim the tax paid as deduction which was shown by it in its audited accounts under advance as discussed supra. The entry tax levied by the Govt. of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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