DEPUTY COMMISSIONER OF INCOME TAX , CHENNAI vs. M/S. CHEMPLAST SANMAR LIMITED, CHENNAI

ITA 2627/CHNY/2025Status: DisposedITAT Chennai06 February 2026AY 2017-18Bench: the CIT(A), who vide impugned order allowed the provision for gratuity of Rs.1,75,37,548/- following the decision of the Tribunal in assessee's own case for assessment years 2008-09 to 2014-15. The Ld.CIT(A) deleted the addition made u/s.14A of the Act accepting the contention of the assessee company that in the absence any expenditure incurred to earn exempt income, no disallowance u/s.14A can be made. The CIT(A) also directed the AO to allow addition made on account of CSR expenses follow15 pages
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What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s deletion of disallowance for gratuity and benevolent fund contributions, and the addition under Section 14A. However, the deletion of CSR expenses was set aside and remanded to the AO for verification.

What were the facts?

The Revenue appealed against the CIT(A)'s order which deleted additions made by the AO. The additions included disallowance of provision for gratuity, contribution to a benevolent fund, disallowance under Section 14A, and CSR expenses.

What were the issues?

The primary issues involved the deductibility of provision for gratuity and benevolent fund contributions, the applicability of Section 14A for exempt income, and the deductibility of CSR expenses.

Which sections of the Income-tax Act were involved?

Section 40A(7),Section 43B,Section 40A(9),Section 14A,Section 115JB,Section 37(1),Section 135

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Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI INTURI RAMA RAO

Hearing: 03.02.2026Pronounced: 06.02.2026

PER INTURI RAMA RAO, ACCOUNTANT MEMBER:

This is an appeal filed by the Revenue directed against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (herein after the ‘CIT(A)’) dated 24.07.2025 for the assessment year 2017-18. :- 2 -:

2.

Brief facts of the case are that, the assessee is a company incorporated under the provisions of the Companies Act, 1956. It is engaged in t

The order continues below.

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