2000 PLP 696 (PTD)
K. N. OIL INDUSTRIES Versus COMMISSIONER OF INCOME-TAX
| Citation | 2000 PLP 696 (PTD) |
| Forum / Court | 232 I T R 479 |
| Bench Members | A. K. Mathur, C. J. and S. K. Kulshrestha, J |
| Parties | K. N. OIL INDUSTRIES Versus COMMISSIONER OF INCOME-TAX |
| Primary Law | Income-tax |
Q1: What are the key laws and sections cited in 2000 PLP 696 (PTD)?
This judgment primarily cites: Income-tax as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2000 PLP 696 (PTD)?
The case was heard and decided by the 232 I T R 479 bench comprising: A. K. Mathur, C. J. and S. K. Kulshrestha, J.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2000 PLP 696 (PTD) (K. N. OIL INDUSTRIES Versus COMMISSIONER OF INCOME-TAX). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Headnotes / Summary
Disallowance must be made out of total expenses and not in respect of separate business or separate offices
Indian Income Tax Act, 1961, S. 37(3A). The disallowance for the purpose of section 37(3A) of the Income Tax Act, 1961, should be made out of total specified expenses of the assessee and not from such expenses for separate business and/or separate offices computed separately under section 37(3A). Under section 37(3A), the expression used is "aggregate expenditure incurred by the assessee.'' B. L. Nema for the Assessee. Abhay Sapre for the Commissioner.
Judgment & Decree
A. K. MATHUR, C. J.
This is an income-tax reference under section 256(1) of the Income Tax Act, 1961, at the instance of the assessee and the following question has been referred for answer by this Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the disallowance for the purposes of section 37(3A) of the Income Tax Act, 1961, should be made out of total specified expenses of the assessee and not from such expenses for separate business and/or separate offices computed separately under section 37(3A) as claimed by the assessee?" The assessee is a registered firm engaged in the business of supply of different commodities at head office and branches. The accounts of the following branches are separately maintained: (i) Swastik Industries, Mahasamund. (ii) Shri Ganesh Twins Mills, Raipur. (iii) Swastik Soaps and Detergents, Mahasamund. The assessee was maintaining separate accounts. The specified expenditure covered in section 37(3A) and the disallowance were worked out for each unit. The claim was not allowed by the Assessing Officer who had computed the disallowances, after taking the total of specified expenses of all units after allowing specified amount and percentage as specified in section 37(3A). The Commissioner of Income-tax (Appeals) allowed the claim taking each unit as a separate entity for purposes of section 37(3A). The Revenue preferred an appeal before the Income-tax Appellate Tribunal which reversed the finding and held that each of these units could not be treated separately, but treated as one unit. Under section 37(3A), the expression used is "aggregate expenditure incurred by the assessee" and, therefore, it is not possible to treat the three units separately. In this view of the matter, the assessee was not permitted allowance under the Act of all the units for taking to be aggregate units and this disallowance has been given by the Income-tax Officer which has been rightly affirmed by the Tribunal. Hence, in this view of the matter, we are of the opinion that the view taken by the Tribunal is justified and we answer this question against the assessee and in favour of the Revenue. M.B.A./3245/FC Reference answered.