9911796707
TMI Blog2021 (8) TMI 1186X X X X Extracts X X X X X X X X Extracts X X X X ..... r short) by AO, the CSR expenses incurred under the directions of BPE Govt. of India requiring Companies to spend a prescribed percentage of its profits on CSR- and now also made mandatory under the Companies Act. 2. That the appellant seeks leave to add, amend, alter, abandon or substitute any of the above grounds at the time of heavy of appeal. 2. Briefly stated facts of the case are that the assessee company is a joint-venture company owned equally by NTPC Ltd and steal Authority of India. Both these joint-venture partners are public sector undertaking owned by Government of India. For the year under consideration, the assessee filed return of income on 26/09/2014 declaring total income of Rs. 350,86,03,340/-. The return of income fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lantation- Township Rs. 2,62,106/- (iv) Community Development Rs. 61,64,064/- (v) Other CSR expenses Rs. 50,83,382/- 8. We find that identical expenses incurred on corporate social responsibility has been allowed by the Tribunal in ITA 2146/Del/2017 for assessment year 2013-14 observing as under: [E] As mentioned earlier, both sides have agreed before us at the time of hearing that the dispute regarding allowability of CSR expenses is covered in favour of the assessee by aforesaid orders dated 27.4.2018 and 29.11.2018 in assessee's own case, in identical facts and circumstances, in assessee'sfavour. Neither side has brought any distinguishable facts nor circumstances to our attention to persuade us to take a view different from the v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in dispute that these expenses have been incurred and the only reason they were disallowed by the Assessing Officer and so confirmed by the Ld. Commissioner of Income Tax (A) was that this expenditure was not expended wholly or exclusively for the purpose of business of the assessee. Although, it is undisputed that the assessee had incurred this expenditure on the basis of guidelines issued by Bureau of Public Enterprises, Govt. of India, the department was of the view that since the expenditure was not mandatory in nature, the same could not be allowed. However, we are unable to concur with the findings of the lower authorities on this issue and we hold that the disallowance under Explanation (2) to section 37(1) will not come into play ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l palsy children in Rourkela, medical camps in Sirsa village in Bhilai, development of Dongia Pond in a village near Bhilai, construction of Bus stop shed in the city of Rourkela, creating awareness against drug abuse in Bhilai, construction of road in Durgapur etc. besides other expenses incurred under the head. It is not in dispute that these expenses have been incurred and the only reason they were disallowed by the Assessing Officer and so confirmed by the Ld. Commissioner of Income Tax (A) was that this expenditure was not expended wholly or exclusively for the purpose of business of the assessee. Although, it is undisputed that the assessee had incurred this expenditure on the basis of guidelines issued by Bureau of Public Enterprises ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appeal is allowed. 9. We find that identical expenses on tree plantation etc have been allowed by the Tribunal (supra) under section 37 of the Act incurred as wholly and exclusively for the purpose of the business. Thus, respectfully following the same, the expenses incurred in the year under consideration are also eligible for deduction under section 37 of the Act. 10. As regard the contention of the Learned DR that in view of the Explanation-2 to section 37(1), the CSR expenses are not allowable, is concerned, we find that said Explanation-2 has been inserted by way of Finance Act 2014 with effect from 01/04/2015, i.e. the assessment year 2015-16. The Tribunal in the case of ACIT Vs Jindal Power Ltd in ITA No.99//BLPR/2012 for AY 2008 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
