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TMI Blog2018 (4) TMI 1664X X X X Extracts X X X X X X X X Extracts X X X X ..... of the case are that the company is a joint venture company which is owned equally by NTPC Ltd. and Steel Authority of India Ltd. During the year under consideration, the assessee company was engaged in the business of production of thermal power. The return of income was filed declaring Nil income after set off of current year profit with brought forward unabsorbed depreciation and the book profit was declared at Rs. 285,03,42,896/- and tax of Rs. 56,80,87,591/- was paid thereon. The case was selected through CASS for scrutiny assessment and the assessment was completed after making the following additions:- i) Disallowance of provision for retirement benefit- Rs. 55,67,488/- ii) Disallowance of additional depreciation of Rs. 14,12,82 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax at source u/s 194H of the Act. The Ld. AR also submitted that CBDT Circular No. 56/2012 dated 31.12.29012 clarified that no TDS was necessary in the case of bank guarantee commission. 3.1 With respect to ground no. 2 of the department's appeal, the Ld. AR submitted that this ground pertaining to disallowance of CSR expenses was also covered in favour of the assessee by the order of the Raipur Bench of the Tribunal in the case of ACIT vs. Jindal Power Ltd. in ITA No. 99/BLPR /2012. Ld. AR submitted that these expenses were incurred under the directions of the Govt. of India which required the assessee to spend the prescribed percentage of its profits on CSR. 4. In response, the Ld. CIT DR placed reliance on the order of assessment and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, the Ld. AR submitted that this issue is also covered in favour of the assessee by order of ITAT Delhi Bench in the case of NTPC Ltd. vs. DCIT in ITA No. 1438/Del/2009 wherein it had been held that power generation companies were eligible for additional depreciation. It was submitted that the Ld. Commissioner of Income Tax (A) had also followed this order of the ITAT, Delhi Bench. The Ld. AR prayed that the ground raised by the department should be dismissed. 6. In response, the Ld. CIT DR vehemently supported the findings of the Assessing Officer and submitted that the Ld. Commissioner of Income Tax (A) had erred in deleting the disallowances made. 7. We have heard the rival submissions and perused the material available on record. We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce. 7.1 Coming to ground no. 2 of the assessee's appeal which challenges the expenses incurred towards corporate social responsibility, we find that the Raipur Bench of ITAT in the case of ACIT vs. Jindal Power Ltd. In ITA No. 99/Del/2012 has allowed CSR expenses in assessment year 2008-09. The Raipur Bench has further held that Explanation (2) to section 37 of the Act, inserted by Finance Act, 2012 has been brought into the Statute w.e.f. 1.4.2013 and this amendment is prospective in nature and accordingly prior to 1.4.2013, CSR expenses are revenue in nature and allowable. We have gone through the details of CSR expenditure incurred by the assessee during the year under consideration i.e. assessment year 2011-12 and we find that the exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... social responsibility incurred prior to this date will necessarily be allowable as revenue expenditure. Accordingly, we set aside the order of the Ld. Commissioner of Income Tax (A) on this issue and direct the Assessing Officer to allow the expenses incurred towards corporate social responsibility. 8. In the result, the appeal filed by the assessee stands allowed. 9. Coming to the appeal filed by the department in ITA No. 6501/Del/2014, ground nos. 1.1 and 1.2 challenge the action of the ld. Commissioner of Income Tax (A) in deleting provision for long service award made on actuarial basis. We find that this issue is squarely covered in favour of the assessee by order of ITAT Delhi Bench in assessee's own case for assessment years 2008-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of State of Andhra Pradesh vs. NTPC and had held that 'electricity' would fall under the definition of goods as given in Article 366 (12) of the Constitution of India. The Hon'ble Apex Court, in this case, had observed that 'goods' means all kinds of moveable properties and merely because electrical energy was not tangible or cannot be moved or touched, it cannot cease to be moveable property. The Coordinate Bench of ITAT went on to hold that additional depreciation cannot be denied to the assessee merely on the ground that electricity is not an article or thing. Accordingly, respectfully following the order of the Coordinate Bench in the case of NTPC vs. DCIT (supra), we hold that the Ld. Commissioner of Income Tax (A) had rightly directe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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