2023 (9) TMI 952 - SCH - Income Tax

Education Cess allowed as an expenditure - HELD THAT - Respondent states that the respondent Sesa Goa Ltd. (now known as M/s. Vedanta Ltd.) had not claimed the Education Cess as an expenditure in the return. The claim was made in the appellate proceedings before the CIT(Appeals). It is stated that no amount has been refunded to the respondent. AO will examine these statements and pass appropriate orders. Appeal is allowed in above terms.

Summary

Issues Involved:
The issue involved in this case is whether "Education Cess" can be allowed as an expenditure u/s the Income Tax Act, 1961.

Judgment Summary:

The Supreme Court, in a case involving the allowance of "Education Cess" as an expenditure u/s the Income Tax Act, 1961, heard arguments from both the petitioner and respondent. The respondent, Sesa Goa Ltd. (now known as M/s. Vedanta Ltd.), had not initially claimed the "Education Cess" as an expenditure in their return but made the claim during the appellate proceedings before the Commissioner of Income Tax (Appeals).

The learned counsel for the respondent acknowledged that due to subsequent amendments in the Income Tax Act, 1961, "Education Cess" cannot be allowed as an expenditure. Consequently, the impugned judgment was set aside, and the appeal was allowed, affirming that the "Education Cess" cannot be considered as an expenditure.

It was clarified that no amount had been refunded to the respondent, and the assessing officer was directed to examine the statements provided and pass appropriate orders accordingly. The appeal was allowed based on the above terms, and any pending application(s) were deemed disposed of as per the court's decision.

This judgment serves as a precedent regarding the treatment of "Education Cess" as an expenditure under the Income Tax Act, 1961, and provides clarity on the matter for future cases.