PR COMMISSIONER OF INCOME TAX JAIPUR-II vs. M/S RAJASTHAN RENEWABLE ENERGY CORP LTD

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ITA/331/2018HC RajasthanRJHC02107248201827 August 2019Bench: S. RAVINDRA BHAT,INDERJEET SINGH1 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the issue raised in the appeal is covered by its previous judgment in D.B. Income Tax Appeal No.145/2015 (Principal Commissioner of Income Tax Vs. M/s. Rajasthan State Industrial Development & Investment Corporation Ltd.), decided on 02/08/2017. The court applied the ratio of that judgment to the present appeal. However, the court also noted that the said previous judgment is subject to a special leave petition pending before the Supreme Court. Therefore, the parties are bound by the final judgment of the Supreme Court. The appeal was disposed of in light of this, with the operative direction being that the parties shall be bound by the final Supreme Court judgment.

What were the facts?

The appeal concerns the assessment years not explicitly stated in the judgment. The appellant is the Principal Commissioner of Income Tax, Jaipur – II, and the respondent is M/s. Rajasthan Renewable Energy Corporation Ltd. The appeal challenges an order (not specified which authority passed it) that deleted a disallowance made by the Revenue. The disallowance pertained to a contribution made by the assessee to the Energy Conservation Fund, which the assessee claimed as a deduction under Section 37(1) of the Income Tax Act. The High Court heard the appeal and noted that the issue is covered by a previous judgment of the same court.

What were the issues?

1. Whether the contribution made to the Energy Conservation Fund is an allowable deduction under Section 37(1) of the Income Tax Act, 1961. The Revenue's contention is that the deletion of the disallowance made by it was incorrect. The assessee's contention, implied by the deletion, is that the contribution is a deductible expenditure. The judgment states that the question of law urged by the Revenue relates to the deletion of disallowance of contribution made to the Energy Conservation Fund, with the assessee claiming deductions under Section 37(1). The judgment does not record specific arguments or authorities cited by either party beyond this framing.

Which sections of the Income-tax Act were involved?

Section 37(1)

AI-generated summary — verify with the full judgment below

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 331/2018 Pr. Commissioner of Income Tax, Jaipur – II, Jaipur ------Appellant Vs. M/s. Rajasthan Renewable Energy Corporation Ltd., Akshay Urja Bhawan, E-166, Yudhister Marg, C-Scheme, Jaipur -------Respondent For Appellant(s) : Mr. Prateek Kedawat on behalf of Mr. R.B. Mathur For Respondent(s) : HON'BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE INDERJEET SINGH Judgment 27/08/2019 1. Heard. 2. The question of law urged by the Revenue relates to the deletion of disallowance of contribution made to the Energy Conservation Fund – the assessee claimed deductions under Section 37(1). This is covered by the judgment of this Court in D.B. Income Tax Appeal No.145/2015 (Principal Commissioner of Income Tax Vs. M/s. Rajasthan State Industrial Development & Investment Corporation Ltd.) decided on 02/08/2017. 3. The judgment of this Court is subject-matter of special leave petition pending before the Supreme Court. 4. Accordingly, the judgment in Principal Commissioner of Income Tax Vs. M/s. Rajasthan State Industrial Development & Investment Corporation Ltd. is hereby applied; however, the parties shall be bound by the final judgment of the Supreme Court. 5. The appeal is disposed of. (INDERJEET SINGH),J (S. RAVINDRA BHAT),CJ ANIL KUMAR GOYAL /MG/23

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