Assessee-company made payments towards community services and social welfare in vicinity of its business operations and claimed same as revenue expenditure. As said payments were envisaged under a Memorandum of Settlement (MOS) dated 31-3-1986 between assessee and workmen\u2019s union of workers employed by assessee, Assessing Officer disallowed said payments on ground that same were to be disallowed under section 40A(9). Tribunal allowed the claim as revenue expenditure. On appeal the tribunal held that\u00a0\u00a0 since payments made by assessee were for public causes in locality of its business operations and benefits flowed from it to business of assessee, merely because a commitment to continue such welfare measures was recited in Memorandum of Settlement with workmen’s union, these payments would not partake of character of payments made under Memorandum of Settlement or payment required to be made under labour law, or for that matter, payment that was made as an ’employer’ so as to attract section 40A(9). Order of Tribunal affirmed. (AY. 1987-88,1988-89)<\/p>\n","protected":false},"excerpt":{"rendered":"
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