Gangeshwar Ltd. vs Commissioner Of Income-Tax
2001 Latest Caselaw 1197 Del

Citation : 2001 Latest Caselaw 1197 Del
Judgement Date : 16 August, 2001

Delhi High Court

Gangeshwar Ltd. vs Commissioner Of Income-Tax on 16 August, 2001

Equivalent citations: 97 (2002) DLT 681, 2002 254 ITR 589 Delhi

Bench: A Pasayat, D Jain

JUDGMENT

1. The following questions have been referred for the opinion of this court under section 256(1) of the Income-tax Act, 1961 (in short "the Act"), by the Income-tax Appellate Tribunal, Delhi Bench-E (in short "the Tribunal").

"1. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the assessed was not entitled for weighted deduction1 under section 35C on a sum of Rs. 2,74,201 ?

2. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the assessed was not entitled to weighted deduction under Section 35C read with Rule 6A on the expenses for road repairs directly incurred by the assessed amounting to Rs. 1,04,620 and his contribution for construction of new road in sides the five year plan amounting to Rs. 1,25,717 ?"

2. The dispute relates to the assessment year 1975-76.

3. The point in issue relates to agricultural development allowance under section 35C of the Act. So far as the first question is concerned, it relates to expense relatable to aerial spray of insecticides. It was not disputed before the Tribunal that the said aerial spray of insecticides was done by the Cane Development Council on behalf of the assessed and other sugar cane factory owners, cane growers and the Government of U. P. The question that arose was whether it could be said that the expense was incurred by the assessed directly or through an association or body which has been approved for the purpose of the provision by the prescribed authority. Admittedly, the Cane Development Council was not an association or body which has been approved by the prescribed authority for the purpose of the provision in question. The requirement is that the claim of weighted deduction is allowable when an expenditure is directly incurred. Therefore, the answer to the first question referred has to be in the affirmative, in favor of the Revenue and against the assessed. So far as the second question is concerned the expenditures are not covered by any of the prescribed conditions for entitlement to weighted deduction under Section 35C of the Act. Therefore, the answer to the second question is also in the affirmative, in favor of the Revenue and against the assessed.

4. The reference stands disposed of accordingly.