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TMI Blog2019 (2) TMI 1652X X X X Extracts X X X X X X X X Extracts X X X X ..... the expenditure could be stated to have been incurred for the purpose of business of the assessee. In the process, the Tribunal referred to and relied upon various judgments of the different High Courts touching on similar issue. We notice that in case of P. Balakrishnan, Commissioner of Income Tax Vs. Travancore Cochin Chemicals Ltd. [ 1999 (10) TMI 33 - KERALA HIGH COURT] had examined whether the amounts spent by the assessee towards contribution to school in which children of the employees were studying, would be hit by Section 40A(9) of the Act and therefore, not allowable as deduction u/s 37. Holding allowability of expenses it was held that the expenditure met by the assessee was wholly and exclusively for the welfare of its employees ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assesseecompany would receive their basic education. The Assessing Officer was of the opinion that the claim would be hit by subsection 9 of Section 40A of the Income Tax Act, 1961 ("the Act" for short). The Tribunal by the impugned judgment allowed the assessee's appeal and held that the expenditure was allowable in terms of Section 37(1) of the Act. The Tribunal referred to earlier judgment of this very assessee rendered by the Tribunal in which detailed reference was made to various decisions of different High Courts including this Court. 4. At the outset, we may record that against the judgment of the Tribunal case of this very assessee for the earlier assessment year 200506, the question does not appear to have been carried in ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. At the time when the hospital was ready, the Employees' State Insurance Scheme came into operation and the Government of Bihar required the hospital. Some negotiations had taken place between the assessee and the Government and also the workers' union. On the basis of the said settlement, the assessee had given an amount of ₹ 50,000 to the Government for the purchase of equipment for the hospital. The company had two kinds of employees, viz., those who were covered by the provisions of the Employees' Insurance Scheme which provides for hospital benefits and also employees who were not covered by the scheme. By making the payment of ₹ 50,000, the company obtained a privilege of getting its employees who were not co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... favour of the assessee and against the Revenue." 5. Similarly, Bombay High Court in case of Commissioner of Income Tax Vs. Bharat Petroleum Corporation Limited 252 ITR 43 had occasion to examine whether the expenditure incurred by the assessee in establishing a club to carry on welfare activities can be claimed by way of expenditure under section 37(1) ignoring the limitation contained under Section 40A(9) of the Act. The High Court while dismissing the revenue's appeal and approving the view of the Tribunal in this context observed as under: "6. Bharat Petroleum Corporation is a Central Government undertaking. It has incorporated a club, essentially to carry on staff welfare activities. Under Clause 28, Bharat Petroleum Corporatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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