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TMI Blog2022 (1) TMI 1263X X X X Extracts X X X X X X X X Extracts X X X X ..... der the Company's Act 1956 as amended in A.Y. 2006-07 under mandatory direction of Ministry of Finance, Government of India. Prior to this corporate status, it was operating as an integral part of Ministry of Finance, Government of India as pure Government treasury/department. 5. Its business activities and objective for printing currency notes of all denominations of RBI, Government of India coins, Printing of Judicial and Non-Judicial stamp papers, all types of postal and non-postal stamps and stationery, passport, visa and other travel documents MICR and non MICR cheques in continuous stationary forms, identity cards, Railway warrants, Income Tax Return forms and orders forms, public saving instruments and commemorative stamp etc. 6. It has also entered into other markets like mark sheets and certificates with security features for Government Universities. It has praised stamps with fragrance and indulges in new products to accommodate technology changes and environmental requirements. It has been set up with the following commercial units in India: i. Bank Note Press, Dewas ii. Currency Note Press, Nashik iii. India Security Press, Nashik iv. Security Printing Press, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... engagement is subject to the following conditions: 1. You are requested to start this assignment w.e.f. 02.06.2008. 2. As per you presentation held on 25.04.2008, the services will be provided by your turn on honorary basis. 3. All investment will be made in compliance with the Department of Public Enterprise guidelines and guidelines of SPMCIL. 4. Fund position and cash flow of SPMCIL will be monitored and reviewed on a weekly basis and based on the same, investment advisor will recommend investment strategy and plan for investment in various applicable/admissible instruments. 5. Quarterly review of the portfolio of investments with the SPMCIL authorities. 6. If the performance of your firm will be found to be unsatisfactory, then this appointment may be terminated at a notice of one month without assigning any further reasons. 7. Full confidentiality will be resorted to in all the transactions related to SPMCIL Funds. 11. Since, the funds have been utilized for investment without incurring any expenses and keeping in view the evidences submitted by the assessee that no expenditure has been incurred for investment, no disallowance u/s 14A is called for. The appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is that only taxes paid are to be disallowed in the assessment for the assessment years 196263 onwards. 17. The ld. AR also relied on the judgment of Hon'ble Rajasthan High Court in the case of Chambal Fertilisers and Chemicals Ltd. Vs JCIT in ITA No. 52/2018 dated 31.07.2018 wherein the same issue has been decided in favour of the assessee and particularly held that education cess is an allowable expenditure. 18. Further, he argued that in the case of ITC Vs ACIT in ITA No. 685/Kol/2014 dated 27.11.2018 wherein it was held that the education cess is an allowable expenditure. 19. The ld. AR has also relied in the case of Peerless General Finance & Investment Co. Ltd. Vs DCIT in ITA No.937 & 938/Kol/2018 dated 24.03.2019 wherein it was held that education cess is not tax and is an allowable expenditure. 20. The ld. DR argued that it is not the appropriate forum to raise the issue at this juncture. Since, there is no dispute between the assessee and the Assessing Authorities, a non-dispute cannot be adjudicated. He argued that the education cess is a part of the Income Tax and is a charge on the assessee. Hence, it cannot be treated as expense eligible for deduction. 21. Heard t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on distributed profits under section 115-O or on distributed income under section 115R; (ii) any interest charged under this Act; (iii) surcharge, if any, as levied by the Central Acts from time to time; (iv) Education Cess on income-tax, if any, as levied by the Central Acts from time to time; and (v) Secondary and Higher Education Cess on income-tax, if any, as levied by the Central Acts from time to time. 26. Thus, wherever the legislature wanted to include this term specifically in the statue it has done so under the Act. The term 'tax' has been defined in section 2(43) of the Act to include only Income-tax, Super Tax and Fringe Benefit Tax (FBT). Provision of the section 2(43) is as given below: "tax" in relation to the assessment year commencing on the 1st day of April, 1965, and any subsequent assessment year means income-tax chargeable under the provisions of this Act, and in relation to any other assessment year income-tax and super-tax chargeable under the provisions of this Act prior to the aforesaid date and in relation to the assessment year commencing on the 1st day of April, 2006, and any subsequent assessment year includes the fringe benefit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y invariably goes into the consolidated fund which ultimately is utilised for all public purposes, whereas a cess levied by way of Fee is not intended to be, and does not become, a part of the consolidated fund. It is earmarked and set apart for the purpose of services for which it is levied." 30. We also find that the proceeds from collection of "Education Cess" are not credited to Consolidated Fund but to a non-lapsable Fund for elementary education-"Prarambhik Shiksha Kosh". Since the proceeds from collection of Education Cess are kept separate for a specified purpose, applying the principles in the aforesaid decision of Apex Court in the case of M/s Dewan Chand Builders (supra), it can be said that the same is not in the nature of tax. Hence, it is allowable as deduction. 31. Further, Provisions of Section 37 are perused which are as under: "37. (1) Any expenditure (not being expenditure of the nature described in sections 30 to 36 and not being in the nature of capital expenditure or personal expenses of the assessee), laid out or expended wholly and exclusively for the purposes of the business or profession shall be allowed in computing the income chargeable under the he ..... X X X X Extracts X X X X X X X X Extracts X X X X
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