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TMI Blog2019 (7) TMI 542X X X X Extracts X X X X X X X X Extracts X X X X ..... cer for consideration afresh in accordance with law. First and second substantial questions of law would not arise for consideration, since the matter has been remanded to the Tribunal for fresh consideration. Therefore, the first and second substantial questions of law are not answered and are left open. Expenditure paid directly to its retired employees - Expenditure incurred allowable under Section 37(1) even after allowing expenditure under Section 36(1)(iv) and (v) - Government of India has approved and notified an Employees Retirement Regulations termed as the Tuticorin Port Trust Employees Regulations, 1979 - HELD THAT:- Nature of deduction claimed by the assessee in respect of the payments made in terms of the statutory regulation w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellate Tribunal 'B' Bench, Chennai (for brevity, "the Tribunal"), in I.T.A.No.1830/Mds/2016, for the assessment year 2012- 13; I.T.A.No.1714/Mds/2017, for the assessment year 2010-11; and I.T.A.No.580/Mds/2016, for the assessment year 2009-10 respectively. 2.The Revenue has raised the following three substantial questions of law in all the appeals:- "(i) Whether the ITAT is correct in law in holding that explanation 6 to section 43(6) is applicable for the assessment year 2008-09 instead of the assessment year 2002-03? (ii) Whether the ITAT is correct in law in holding that the assessee need not compute the depreciation as per section 32(1) of the Income Tax Act for the assessment years 2002-03 to 2008-09 when assessee is as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sh consideration. Therefore, the first and second substantial questions of law are not answered and are left open. 6.The third substantial question of law is pertaining to whether the expenditure incurred by the respondent/assessee is allowable under Section 37(1) of the Act, even after allowing expenditure under Section 36(1)(iv) and (v) of the Act. 7.It is the submission of Mr.M.Swaminathan that Section 36(1) of the Act states that deductions provided for in sub-Clauses (i) to (xvi) under sub-Section (1) of Section 36 shall be allowed in respect of the matters dealt with therein, in computing the income referred to in Section 28 of the Act. It is submitted that sub-Clause (iv) deals with any sum paid by the assessee as an employer by wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a capital expenditure or personal expenses of the assessee, laid out or expended wholly and exclusively for the purposes of the business or profession shall be allowed in computing the income chargeable under the head "profit and gains of business or profession". 11.It is the submission of the learned counsel that deduction has already been claimed under Section 36(1)(iv) and (v) of the Act and therefore, the question of claiming deduction under Section 37(1) does not arise and the Assessing Officer was justified in not allowing the same. This issue was considered by the Commissioner of Income-tax (Appeals)-I, Madurai (for brevity, "the CIT(A)"), in the appeals filed by the assessee challenging the assessment orders. The CIT(A) took note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution to the approved superannuation fund and gratuity fund is allowable as deduction under the specific provisions of the Act and the same were utilized only for paying commutation pension and gratuity to the retired employees. It is further contended that the assessee did not claim the same amount as deduction twice and the claim is in accordance with the provisions of the Act and merely because the assessee is claiming deduction in respect of approved superannuation fund and gratuity fund, the Assessing Officer was not justified in rejecting the claim of pension payments which represents the actual monthly pension payments made to the retired employees, which is subject to deduction of tax at source, wherever applicable. 14.The above su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsion fund. This contention was considered by the Tribunal and was rejected. The finding rendered by the Tribunal is contained in paragraph 16. 16.We approve the said finding of the Tribunal for the following reasons. Admittedly, the Revenue has not disputed the fact that there is an approved gratuity fund created by the employer, viz., the respondent/assessee and the payment made towards such fund to the expenditure of ₹ 20 crore was allowed as a deduction. The deduction of the sum of ₹ 23.28 crores is sought to be denied on the ground that it was not routed through the pension fund. This contention raised by the Revenue is liable to be rejected for the simple reason that the Government of India has approved and notified an Em ..... X X X X Extracts X X X X X X X X Extracts X X X X
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