Bombay High Court
K.S.S. Karkhana Ltd.
Versus
Commissioner of I.T.
Decided On:

Headnote:Section 68-See Income Tax Act, 1961, Section 37(1).

       Section 37(1)-Maharashtra co-operative Societies Act. 1961, Section 68 and Maharashtra Cooperative Society Rules, 1961, Rule 53-Assessee a co-operative society a manufacturer of sugar Section 68 requires contribution to education fund of State federal society at the prescribed rates Contribution fund not allowable as business expenditure tribunal-Held, such an expenditure squarely falls within the scope and ambit of Section 37 of Act and same allowable deduction. It was a statutory obligation of the assessee under Section 68 of the Maharashtra Co-operative Societies Act and the making of the contribution was directly connected or related to the carrying on the assessees business. Such an expenditure squarely falls within the scope and ambit of Section 37 of the Act and the same is an allowable deduction. That being so the Tribunal was not correct. In holding that the contribution made by the assessee under Section 68 of the Maharashtra Co-operative Societies Act to the education fund of the State Federal Society was not allowable as a business expenditure.

       Rule 53-See Income Tax Act. 1961, Section 37(1).

       For Citation 1997 (3) Mah LJ 927