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1 - 10 of 22 (0.22 seconds)Section 6 in The Income Tax Act, 1961 [Entire Act]
Commissioner Of Income-Tax And ... vs Indian Copper Corporation Ltd. on 23 January, 1986
16. In fine, questions Nos. (1) and (3) are answered in favour of the asses-see and against the Revenue in terms of our decision in Taxation Cases Nos. 185, 186, 205 and 206 of 1971, disposed of on January 23, 1986 (CIT v. Indian Copper Corporation Ltd. [1986] 161 ITR 327), Question No. (2) is answered in favour of the assessee so far as expenses over defending the employees of the assessee are concerned, but it is answered in favour of the Revenue and against the assessee so far as the expenditure over defending the directors in the prosecution under the Mines Act is concerned. Question No. (4) is answered against the assessee and in favour of the Revenue. In the special facts and circumstances of the case, there shall be no order as to costs.
Section 37 in The Mines Act, 1952 [Entire Act]
Commissioner Of Income Tax, West Bengal vs Birla Cotton Spinning & Weaving Mills ... on 17 August, 1971
For the academic legal question, their Lordships relied upon an earlier decision of the Supreme Court in CIT v. Birla Cotton Spinning and Weaving Mills Ltd. [1971] 82 ITR 166.
Parshva Properties Ltd. vs Commissioner Of Income-Tax, Central on 17 December, 1974
The above should have concluded the matters, but I cannot resist my temptation of referring to another case of the Calcutta High Court in Parshva Properties Ltd. v. CIT [1976] 104 ITR 631. That was a case of an accident in a quarry. A labourer engaged in it had died in the accident. The director, the agent and manager of the company were prosecuted and sentenced. It had been found in the criminal case that the working of the mine was defective and the accident took place because of the failure to comply with the regulations 38 and 40 of the Indian Metalliferous Mines Regulations, 1926. A sum of Rs. 17,057 was alleged to have been incurred in defending the criminal proceedings. That amount included Rs. 3,000 paid as fine. The Tribunal rejected the claim to deduction of the said sum as sums spent wholly and exclusively for the purpose of the business of the company. On a reference, Sabyacachi Mukharji J., laid down some principles which emerged from the decided cases. His Lordship laid down that the question of deductibility of expenditure of that nature must depend on the purpose and nature of the expenditure incurred. Secondly, it had to be found out in what capacity the expenditure was incurred and, lastly, the ultimate result or decision in which the expenses were incurred would not in any way affect the question of allowability of the expenditure. In regard to sums spent in defending the directors, their Lordships of the Calcutta High Court observed that in so far as the expenses were incurred in defending the accused persons in respect of the acts alleged to have been committed in the course of employment of the assessee while carrying on the business of the assessee, unless it could be said that the expenditure was not incurred bona fide, which was not the "ase there, the expenditure should be allowed in computing the total income of the assessee. Their Lordships, however, laid down that the sum of Rs. 3,000 paid as fine could not be allowed as deduction. I am in respectful agreement with the views of Mukharji J. I am, therefore, of the view that the sums spent over defending the employees from criminal prosecution, i. e., the sums of Rs. 7,319 and
Rs. 2, 195 incurred in the assessment years 1965-66 and 1966-67, were allowable deductions.
Commissioner Of Income-Tax,West ... vs H. Hirjee on 17 April, 1953
7. Learned senior standing counsel for the Income-tax Department relied upon CIT v. H. Hirjee [1953] 23 ITR 427, in which the Supreme Court rejected the claim for deductions on account of legal expenses. That was a case where the directors of the assessee were prosecuted under the Hoarding and Profiteering Ordinance, 1943, on the charge of selling goods at higher prices than were reasonable in contravention of the provisions of Section 6 thereof. The respondent defended the cases. The expenditure spent in defending the prosecution which had ended in acquittal was claimed as allowable deductions. The legal expenses as allowable deductions was rejected by the Supreme Court, In my view, the case of H. Hirjee [1953] 23 ITR 427 (SC) was decided on a different footing. That decision proceeded on the footing that the directors were charged with contravention of Section 6 of the Hoarding and Profiteering Ordinance, 1943, which prohibited the sale by a dealer or producer of an article for consideration which was unreasonable. Their Lordships repelled the reasoning of the High Court that since the prosecution had ended in acquittal, the expenses were legally deductible. Their Lordships held that there was chance of conviction as well and, therefore, the question of acquittal or conviction was entirely foreign to the matter in controversy. In this behalf, I can do no better than state that the present case must be decided on the ratio of the Supreme Court decision in Haji Aziz and Abdul Shakoor Bros. v. CIT [1961] 41 ITR 350.
The Commissioner Of Income-Tax vs Chaman Lal & Bros. on 2 March, 1967
Learned counsel for the Revenue placed reliance upon CIT v. Chaman Lal and Bros.
Lakshmi Narayan Gouri Shankar vs Commissioner Of Income-Tax on 21 August, 1974
[1970] 77 ITR 383 (Delhi), Lakshmi Narayan Gouri Shankar v. CIT [1975] 100 ITR 143 (Pat), Raghubir Prasad Gupta v. CIT [1979] 120 ITR 789 (Cal) and CIT v. Malwa Vanaspati & Chemical Co. [1982] 135 ITR 221 (MP), to impress upon us that expenses over criminal prosecution are ex facie not deductible expenditure. These cases stand on a different footing. Those were cases of penalty or fine under a special enactment. Those were not cases of prosecution. The real question which must decide the issue is whether expenses were incurred in defending prosecutions which were wholly and exclusively for the business of the assessee. In the present case, I am clearly of the view that the sums spent over defending the employees were allowable deductions in terms of Section 87 of the Act.
Commissioner Of Income-Tax vs Malwa Vanaspati & Chemical Co. Ltd. on 13 February, 1981
[1970] 77 ITR 383 (Delhi), Lakshmi Narayan Gouri Shankar v. CIT [1975] 100 ITR 143 (Pat), Raghubir Prasad Gupta v. CIT [1979] 120 ITR 789 (Cal) and CIT v. Malwa Vanaspati & Chemical Co. [1982] 135 ITR 221 (MP), to impress upon us that expenses over criminal prosecution are ex facie not deductible expenditure. These cases stand on a different footing. Those were cases of penalty or fine under a special enactment. Those were not cases of prosecution. The real question which must decide the issue is whether expenses were incurred in defending prosecutions which were wholly and exclusively for the business of the assessee. In the present case, I am clearly of the view that the sums spent over defending the employees were allowable deductions in terms of Section 87 of the Act.