Law:

Section:

Section 37(1) of the Income-tax Act, 1961 (Corresponding to section 10(2)(xv) of the Indian Income-tax Act, 1922) - Business expenditure - Allowabiltiy of - Assessment year 1958-59 - Whether contribution made by assessee - shipping company to election fund of Indian National Congress was an admissible deduction in determining its business profits - Held, no FACTS The assessee claimed contribution to the Indian National Congress as a deduction in determining its business profits for the accounting year relevant to the assessment year 1958-59. This was disallowed by the ITO on the ground that it could not be regarded as expenditure incurred or laid out wholly or exclusively for the purpose of the shipping business carried on by the assessee-company. This disallowance was confirmed by the AAC. Before the Tribunal it was contended, that the assessee-company required planning on a long-term basis and it was, therefore, essential that the Congress party which was committed to the declared policy of the Government with regard to shipping should continue in office for a long period to implement that policy. The Tribunal, however, rejected the assessee's contention and concurred with the view taken by the ITO and the AAC. On reference: HELD In view of the decision of this court in CIT v. Elphinstone Spinning and Weaving Mills Co. Ltd. [1975] 100 ITR 139 (Bom), it was to be held that before claim for contribution to a political party is upheld, it would be for the assessee to establish a definite connection and satisfy the revenue authorities that the expenditure was laid out for the purposes of the business, and what had been suggested in the instant case did not indicate such nexus or connection as was requisite for the allowance under section 10(2)(xv). Hence, the aforesaid contribution was not an admissible deduction. Section 41(2) of the Income-tax Act, 1961 (Corresponding to section 10(2)(vii) of the Indian Income-tax Act, 1922) - Balancing charge - Assessment year 1958-59 - Assessee agreed to sell a ship to a foreign buyer - Its accounting year was 1-7-1956 to 30-6-1957 - As per agreement, delivery of ship was to be given in Hamburg - Itinerary of ship just before…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492