| Case ID |
e19b7dd1-e20f-4f5d-8d1e-0f500344c78b |
| Body |
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| Case Number |
Income Tax Application No212 of 1991 connected wit |
| Decision Date |
Sep 19, 1991 |
| Hearing Date |
|
| Decision |
The court held that the question of whether the expenditure incurred by the assessee in providing mineral and aerated water to foreign customers was in the nature of hospitality and could be disallowed under section 37(2A) of the Income Tax Act, 1961, was a question of law. The court directed the Income Tax Appellate Tribunal to refer the matter back to the court for further opinions based on established precedents. |
| Summary |
This case revolves around the interpretation of the Income Tax Act, specifically concerning the classification of business expenditures related to hospitality. The Allahabad High Court examined whether expenses incurred by KRAFT PALACE in providing mineral and aerated water to foreign clients could be categorized as entertainment and thus subject to disallowance under section 37(2A). The ruling emphasized the legal standards for hospitality expenditures and set a precedent for similar future cases. The court's decision to refer the matter back to the Income Tax Appellate Tribunal underscores the importance of clear legal interpretations in tax law, particularly in business contexts where client hospitality is a common practice. This case highlights ongoing discussions regarding tax compliance and the nuances of business expenditure classifications, making it relevant for businesses and tax professionals alike. |
| Court |
Allahabad High Court
|
| Entities Involved |
|
| Judges |
A .P. MISRA,
Dr. R.R. MISRA
|
| Lawyers |
|
| Petitioners |
KRAFT PALACE
|
| Respondents |
COMMISSIONER OF INCOME TAX
|
| Citations |
1993 SLD 91,
1993 PTD 830,
(1993) 199 ITR 104
|
| Other Citations |
Not available
|
| Laws Involved |
Income Tax Act, 1961
|
| Sections |
37(2A,
256
|