Gallonage fee, license fee and shop rental payable by the assessee, which is a state government undertaking is not deductible. The exclusivity referred to in the section is not to be seen in terms of the number of entities which are covered by the policy but the nature of the undertakings which are covered. However, surcharge on sales tax and turnover tax are not disallowable under the section as the same is not a fee or a charge. Court also observed that it is a settled principle of interpretation that where the same statute uses different terms and expressions, it is clear that the Legislature is referring to distinct and different things . (AY. 2014-15, 2015 -16 )
Kerala State Beverages Manufacturing and Marketing Corporation Ltd. v. ACIT (2022) 440 ITR 492 / 209 DTR 257/ 324 CTR 209 / 286 Taxman 1(SC) Editorial , review petition is dismissed ,ACIT v. Kerala State Beverages Manufacturing and Marketing Corporation Ltd (2023) 291 Taxman 357 (SC) Editorial : Decision of Kerala High Court partly affirmed and partly reversed . ( 2022) 440 ITR 496 (SC)
S. 40 (a)(iib) :Amounts not deductible- Fee- Tax – Gallonge fee , licence fee and shop rental (KIST ) with respect to EL-9 and E.L -I licence granted will fall with in the purview of section and hence disallowable -Surcharge on Sales tax and turnover tax is not fee or charge hence not disallowable – Interpretation of taxing statutes – Same statute using different terms and expressions – Must be taken to refer to distinct and different things . [ S. 37(1)), Kerala Abkari Act, 1077 (M.E.) S. 18 , Kerala Foreign Liquor Rules , 1953 , R. 15A ]