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TMI Blog1988 (3) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... khs as deduction being contribution made by it to M.R. Electronics Co. Employees Welfare Trust. In view of the retrospective amendment made to the Income-tax Act by the Finance Act, 1984 by introduction of sub-sec. (9) in sec. 40A, the amount so claimed by the assessee-company has been disallowed by the IAC (Asst.). During the year the said trust apart from other expenditure had incurred expenditu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions, the IAC (Asst.) has allowed deduction of Rs. 76,864 from out of the total income of the assessee. For purpose of computing the amount disallowable u/s 40A(5)/40(c) the IAC (Asst.) took into account the expenditure incurred by the above trust for providing the television sets to the directors and employees of the company amounting to Rs. 76,864 and arrived at a sum of Rs. 38,302 as disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed expenditure for providing certain benefits to the assessee's directors and employees. Sec. 40A(11) stipulates that the expenditure incurred by the assessee before the first day of March, 1984 shall be deducted as if such expenditure had been laid out or expended by the assessee. Once it is held that such expenditure is laid out or expended by the assessee, sec. 40(c)/40A(5) are instantly attrac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consequences of such treatment will follow. It will have to be treated as expenditure incurred by the assessee and all other restrictions imposed on deduction of such expenditure will have to be applied. In fact, sec. 40A(10) also provides that the deduction contemplated under that sub-sec. will be subject to other provisions of the Act. In view of the above, in our opinion, the lower authorities ..... X X X X Extracts X X X X X X X X Extracts X X X X
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