Associated Banking Corporation of India Ltd. v. CIT

56 ITR 1Supreme Court of India1965#2514 most cited

What is Associated Banking Corporation of India Ltd. v. CIT authority for?

A business loss arising from employee embezzlement or fraud is deemed to have occurred only when the employer becomes aware of it and realizes that the embezzled amounts cannot be recovered.

46

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2016 to 2025.

Also referred to as

Associated Banking Corporation of India Ltd. v. CIT · 56 ITR 1 · Section 10(1) Income Tax Act 1922 · Section 28 Income Tax Act 1961 · business loss deduction · embezzlement by employee · fraud by employee · timing of loss · unrecoverable amounts · shortage of stock loss

Sections most often in play

Section 115-PSection 143(3)Section 250Section 10Section 10(1)Section 115-OSection 1403/Bang/2022Section 143(1)(a)
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Issues it is cited on

section 90asection 10(1)unexplained jewellerysection 24(b)under-reporting of incomesection 80cforeign tax creditroyalty incomewithholding taxdisallowance of interest expendituresection 139(4)section 54f

Judgments citing Associated Banking Corporation of India Ltd. v. CIT

ACIT, New Delhi vs. Sh. Sanjay Passi, New Delhi

In the result, the Revenue’s appeal as well as Assessee’s Cross

ITA 1450/DEL/2015[2012-13]Status: DisposedITAT Delhi11 Jul 2018AY 2012-13

Bench: Shri H.S. Sidhu & Shri Prashant Maharishi

For Appellant: Sh. V.K. Agarwal, A.RFor Respondent: Sh. S.S. Rana, CIT(DR)
Section 127Section 132Section 142(1)Section 143(1)Section 143(2)Section 153ASection 2(22)(e)

…ed to be part of accumulated profit. As such, as observed by the Tribunal, the issue is already settled by the SC against the Revenue in the case of Associated Banking Corporation of Ind. Ltd. V Is. Commissioner of Income-Tax, Bombay reported in (1965) Vo1.56 ITR 1 (SC) by which, the view taken that the profit accrues when the books of account are closed." OSERVATIONS OF THE AO 6 (a). The Ld. AO has observed that the agreement to sell the property was only a tax evasion scheme (page 5 of the asstt. Order). In this connection it is submitted that the agreements are genuine and even the Ld. AO has not bro…

ACIT 4(2), Mumbai vs. Mehta Equities Ltd ( Formerly Shree Securities Ltd), Mumbai

In the result, appeal filed by the Revenue is dismissed and Cross

ITA 4041/MUM/2012[2008-09]Status: DisposedITAT Mumbai31 May 2017AY 2008-09

Bench: Shri B.R. Baskaran (Am) & Shri Amarjit Singh (Jm)

Section 143(3)Section 28Section 36(2)

…s loss and is correctly claimed by the appellants during the year and the same does not pertain to any of the earlier years. I find strength from the Apex com decision relied on by the Ld. AR in the case of Associated Banking Corporation India Ltd reported in 56 ITR 1 which has held as follows :- The embezzlements undoubtedly took place in the year of account ending June 30, 1947. The secretary misused the powers conferred upon him under the power of attorney and withdrew ` 18,00,000 by posting entries in the names of persons who did not exist, or who had no dealings with the bank. But until an investigation of t…

The Pr. Commissioner of Income Tax-4 vs. Industrial Finance Corporation of India Ltd

ITA/170/2017HC Delhi15 Mar 2017

Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MR. JUSTICE NAJMI WAZIRI

Section 10(2)Section 28

…ccepted in the current year. The reliance placed by the appellant on circular dated 24.11.1965 issued by CBDT on the basis of law laid by Hon'ble Supreme Court in case of Badridas Daga Vs. CIT 34 ITR 10 and associated Banking Corporation of India Ltd. Vs. CIT 56 ITR 1 wherein case of embezzlement it is stated that the loss should be allowed as deduction in the year in which it is discovered. Therefore, in the year in which the loss is discovered and determined by the assessee same should be allowable in that year. According to the various notes, the losses have been discovered and determined during the year and t…

Hindustan Coca- Cola Marketing Company Pvt. Ltd., Gurgaon vs. DCIT, New Delhi

In the result, assessee’s appeal is partly allowed

ITA 1244/DEL/2013[2004-05]Status: DisposedITAT Delhi29 Jul 2016AY 2004-05

Bench: Shri S.V. Mehrotra : & Shri C.M. Garg :Asstt. Yrs: 2004-05 Hindustan Coca-Cola Marketing Vs. Dcit Circle 12(1), Company Pvt. Ltd., New Delhi. Orchid Centre, 3Rd Floor, Dlf Golf Course Road, Sector-53, Gurgaon. Pan: Aabch 1541 D ( Appellant ) (Respondent)

For Appellant: Mr. Sachit Jolly AdvFor Respondent: Shri Amrit Lal Sr. DR
Section 143(3)Section 263

…amount of Rs. 37.59 lakh was towards actual write off. He relied on following decisions in support of his contention that embezzlement loss is an allowable loss: - Badridas Daga Vs. CIT 44 ITR 10 (SC); - Associated Banking Corporation of India Ltd. Vs. CIT 56 ITR 1 (SC); and - Punjab Steel Stockholders Syndicate Ltd. Vs. CIT 125 ITR 519 (P&H). 6. Ld. Sr. DR submitted that since police has not filed final report, therefore, it is still an uncertained liability. 7. We have considered the submissions of both the parties and have perused the record of the case. In the FIR the assessee, inter alia, stated as unde…

Mohit Kamboj, Mumbai vs. ITO 6(2)(1), Mumbai

In the result, both the appeals filed by the assessee are partly allowed

ITA 3366/MUM/2013[2009-10]Status: DisposedITAT Mumbai13 Jul 2016AY 2009-10

Bench: Shri B.R. Baskaran (Am) & Shri Ram Lal Negi

Section 2(22)(e)

…not required to be included to be part of accumulated profit. As such, as observed by the learned Tribunal, the issue is already settled by the Hon’ble Supreme Court against the Revenue in the case of Associated Banking Corporation of India Ltd Vs. CIT (1965)(56 ITR 1) by which, the view taken that the profit accrues when the books of account are closed.” By respectfully following the above said decisions, we hold that the accumulated profits shall not include current year’s proportionate profit, since the current years profit shall be deemed to accrue only when the books of account are closed at the year end. A…

Mohit Kamboj, Mumbai vs. ITO 6(2)(1), Mumbai

In the result, both the appeals filed by the assessee are partly allowed

ITA 3365/MUM/2013[2008-09]Status: DisposedITAT Mumbai13 Jul 2016AY 2008-09

Bench: Shri B.R. Baskaran (Am) & Shri Ram Lal Negi

Section 2(22)(e)

…not required to be included to be part of accumulated profit. As such, as observed by the learned Tribunal, the issue is already settled by the Hon’ble Supreme Court against the Revenue in the case of Associated Banking Corporation of India Ltd Vs. CIT (1965)(56 ITR 1) by which, the view taken that the profit accrues when the books of account are closed.” By respectfully following the above said decisions, we hold that the accumulated profits shall not include current year’s proportionate profit, since the current years profit shall be deemed to accrue only when the books of account are closed at the year end. A…