Season Rubber Ltd. vs Commissioner of Income Tax

C.N. Ramachandran Nair, J.—Contribution made by the assessee totalling Rs. 16,500 to a school and to a hospital development committee were claimed for benefit u/s 80G of the Income Tax Act, 1961. However, since the recipients did not have registration and could not issue certificates u/s 80G of the Act, the assessee shifted the stand and claimed the contributions as business expenditure eligible for deduction Section 37(1) of the Act. The Tribunal declined the claim, against which this reference is sought by the assessee.

We have heard learned Counsel for the applicant and learned standing counsel for the respondent. We do not think that the assessee is entitled to the claim u/s 37(1) of the Act, because the assessee''s prospects are not advanced by making these contributions. Even though learned Counsel contended that the assessee''s employees are getting treatment from the hospital and the employees'' children are students in the school which got the benefit we find the benefit, if at all, is quite remote and not to any person. We, therefore, answer the question referred, against the assessee and in favour of the Department.