Bharat Earth Movers v. CIT

245 ITR 428Supreme Court of India2000#52 most cited

What is Bharat Earth Movers v. CIT authority for?

A business liability that has definitely arisen in an accounting year is deductible even if it needs to be quantified and discharged later, as long as its incurring is certain and can be reasonably estimated.

901

judgments rely on this decision, according to BharatTax’s citation analysis of 367,181 Indian tax judgments — from 2006 to 2026.

Also referred to as

Bharat Earth Movers v CIT · 245 ITR 428 · ascertainable liability · unascertainable liability · accrued liability · provision for expenses · deduction · accounting year · future discharge

Also reported as

112 Taxmann 616 SCC 645162 CTR 325

Sections most often in play

Section 37(1)Section 143(3)Section 115JBSection 14ASection 40(a)(ia)Section 195Section 148Section 1961
Read the full judgment

Issues it is cited on

section 35dmercantile system of accountingenduring benefitintangible assetssection 40(a)(i)section 35revenue expenditurebook profitssection 37(1)section 115jbamalgamationsection 37

Judgments citing Bharat Earth Movers v. CIT

DCIT, Circle-7(1), Kolkata vs. M/S Bengal Peerless Housing Development Company Ltd, Kolkata

In the result, the appeal filed by the assessee is allowed whereas the appeal filed by the revenue is dismissed

ITA 2549/KOL/2017[2012-13]Status: DisposedITAT Kolkata31 Dec 2018AY 2012-13

Bench: Shri A.T. Varkey, Jm & Dr. A.L.Saini, Am आयकरअपीलसं./Ita No.2414/Kol/2017

For Appellant: Shri S.K. Tulsiyan, Adv.& Shri S. De,(CA)For Respondent: Robin Choudhury, Addl. CIT Sr. DR
Section 143(3)

…s( estimated expenditure explained above) is present in the assessment year under consideration though it should bedischarged at a future date.For that we rely on the judgment of the Hon’ble Supreme Court in the case of Bharat Earth Movers vs. CIT reported in 245 ITR 428, wherein the same facts and ratio was decided. 14. At the cost of repetition, we reiterate the facts that the assessee is following project completion method and in this method the revenue is recognized when a substantial portion of the construction work is completed although some unfinished ancillary works may remain pending. The total expendit…

M/S Bengal Peerless Housing Development Company Ltd, Kolkata vs. DCIT, Circle-7(1), Kolkata

In the result, the appeal filed by the assessee is allowed whereas the appeal filed by the revenue is dismissed

ITA 2414/KOL/2017[2012-13]Status: DisposedITAT Kolkata31 Dec 2018AY 2012-13

Bench: Shri A.T. Varkey, Jm & Dr. A.L.Saini, Am आयकरअपीलसं./Ita No.2414/Kol/2017

For Appellant: Shri S.K. Tulsiyan, Adv.& Shri S. De,(CA)For Respondent: Robin Choudhury, Addl. CIT Sr. DR
Section 143(3)

…s( estimated expenditure explained above) is present in the assessment year under consideration though it should bedischarged at a future date.For that we rely on the judgment of the Hon’ble Supreme Court in the case of Bharat Earth Movers vs. CIT reported in 245 ITR 428, wherein the same facts and ratio was decided. 14. At the cost of repetition, we reiterate the facts that the assessee is following project completion method and in this method the revenue is recognized when a substantial portion of the construction work is completed although some unfinished ancillary works may remain pending. The total expendit…

M/S 2M Power Health Management Services Private Limited, Bangalore vs. Income Tax Officer Ward-7(1)(2), Bangalore

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 2880/BANG/2018[2015-16]Status: DisposedITAT Bangalore21 Dec 2018AY 2015-16
For Appellant: Shri Sharath Rao, C. AFor Respondent: Shri C. H. Sundar Rao, CIT (DR)
Section 56(2)(viib)

…the estimation has to be on a scientific basis. This view of us is supported by the judgments of Hon’ble Apex court rendered in the case of Rotork Controls India (P) Ltd. as reported in 314 ITR 62 and in the case of Bharat Earth Movers vs. CIT as reported in 245 ITR 428. In both these cases, the dispute was regarding estimation of future liability on account of warranty provisions and leave encashment respectively and it was held that it should be capable of being estimated with reasonable certainty though actual quantification may not be possible. In the present case, estimation is to be made of future cash flo…

ACIT, New Delhi vs. M/S. Housing & Urban Development Corporation Ltd., New Delhi

In the result, Assessee’s appeal vide ITA No

ITA 6151/DEL/2014[2007-08]Status: DisposedITAT Delhi21 Dec 2018AY 2007-08

Bench: Shri Amit Shukla & Shri Anadee Nath Misshra

For Appellant: Sh. Gagan Kumar, Adv. &For Respondent: Sh. K.J. Singh, CIT (DR)
Section 143(3)Section 14ASection 263

…Fit for Publication ITA Nos.-5705 & 6151/Del/2014. (AM) (JM) Housing & Urban Development Corporation Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘C’: NEW DELHI) BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA No:- 5705/Del/2014 (Assessment Year: 2007-08) M/s Housing & Urban Development Addl. Commissioner of Income Corporation Ltd., Vs. Tax, (HUDCO), Hudco Bhawan, Range-12, New Delhi. Lodhi Road, New Delhi-110003. PAN No: AAACH0632A APPELLANT RESPONDENT ITA No:- 6151/Del/2014 (Assessment Year: 2007-08) ACIT, M/s Housing & Urban Circle 12(1), Vs. Developme…

M/S. Housing & Urban Development Corporation Ltd. (Hudco), New Delhi vs. DCIT, New Delhi

In the result, Assessee’s appeal vide ITA No

ITA 5705/DEL/2014[2007-08]Status: DisposedITAT Delhi21 Dec 2018AY 2007-08

Bench: Shri Amit Shukla & Shri Anadee Nath Misshra

For Appellant: Sh. Gagan Kumar, Adv. &For Respondent: Sh. K.J. Singh, CIT (DR)
Section 143(3)Section 14ASection 263

…Fit for Publication ITA Nos.-5705 & 6151/Del/2014. (AM) (JM) Housing & Urban Development Corporation Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘C’: NEW DELHI) BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA No:- 5705/Del/2014 (Assessment Year: 2007-08) M/s Housing & Urban Development Addl. Commissioner of Income Corporation Ltd., Vs. Tax, (HUDCO), Hudco Bhawan, Range-12, New Delhi. Lodhi Road, New Delhi-110003. PAN No: AAACH0632A APPELLANT RESPONDENT ITA No:- 6151/Del/2014 (Assessment Year: 2007-08) ACIT, M/s Housing & Urban Circle 12(1), Vs. Developme…

Haworth (India) Private Ltd., Pune vs. Deputy Commissioner of Income-Tax

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 520/PUN/2015[2010-11]Status: DisposedITAT Pune12 Dec 2018AY 2010-11

Bench: Ms. Sushma Chowla, Jm & Shri D. Karunakara Rao, Am

For Appellant: Shri S. P. ChidambaramFor Respondent: Shri S. B. Prasad, CIT
Section 143(3)Section 144C(5)

…आयकरअपील"यअ"धकरण, पुणे"यायपीठ “ए” पुणेम" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE सु"ीसुषमाचावला, "या"यकसद"यएवं"ीडी. क"णाकराराव, लेखासद"यकेसम" BEFORE MS. SUSHMA CHOWLA, JM AND SHRI D. KARUNAKARA RAO, AM आयकरअपीलसं. / ITA No.520/PUN/2015 "नधा"रणवष"/ Assessment Year : 2010-11 Haworth (India) Pvt. Ltd., No.47, Spurtank Road, Heavitree Building, No.1A, 1st Floor, Chetpet, Chennai – 600 031. अपीलाथ"/Appellant PAN : AAACH8417K …. Vs. DCIT, Circle-1(2), …. ""यथ"/ Respondent Pune. अपीलाथ"क"ओरसे/ Appellant by : Shri S. P. Chidambaram ""यथ"क"ओरसे/ Respondent by : Shri S. B. Prasad, CIT सुनवाईक"तार"ख/ घोषण…

ACIT (E), New Delhi vs. M/S Goodearth Foundation, New Delhi

In the result, appeal of the revenue is dismissed

ITA 1254/DEL/2016[2012-13]Status: DisposedITAT Delhi29 Nov 2018AY 2012-13
Section 11Section 12ASection 28Section 43BSection 80G

…Circular No.5.P(LXX-6)/1968 dated 19th June 1968 issued by CBDT, the income should be understood in its commercial sense i.e. the book income. Assessee placed reliance on the decisions of the Hon’ble Apex court in the case of Bharat Earth Movers Ltd. Vs CIT, 245 ITR 428 for the principle that under the mercantile system of accounting, provisions for leave encashment is an allowable deduction in the year of accrual. Further, reliance was placed on the decision of the Hon’ble Apex Court in the case of CIT vs Garware Synthetics Bristles, 205 ITR 426 for the principle that the provision made for payment of gratuity…

Deputy Commissioner of Income Tax, Circle-1, Kakinada vs. Sar Chandra Environ Solutions Private Limited, Kakinada

In the result, appeals filed by the Revenue and the cross objections filed by the assessee are dismissed

ITA 149/VIZ/2018[2014-15]Status: DisposedITAT Visakhapatnam28 Nov 2018AY 2014-15

Bench: Shri V. Durga Rao, Hon’Ble & Shri D.S. Sunder Singh, Hon’Ble

For Appellant: Shri G.V.N. Hari – AdvocateFor Respondent: Mrs. Suman Malik – Sr.DR
Section 143(1)Section 148

…me Tax authorities has no jurisdiction to meddle in the matter either by directing the assessee to maintain its account in a particular manner or adopt a different method for valuing work-in-progress. Hon'ble Supreme Court in Bharat Earth Movers vs CIT (2000) 245 ITR 428 (SC) considered the general principles regarding allowance of business expenditure and the difference between accrued and contingent liabilities. It was held that “if a business liability has definitely arisen in the accounting year, the deduction should be allowed although the liability may have to be quantified and discharged at a future date.…

Deputy Commissioner of Income Tax, Circle-1, Kakinada vs. Sar Chandra Environ Solutions Private Limited, Kakinada

In the result, appeals filed by the Revenue and the cross objections filed by the assessee are dismissed

ITA 148/VIZ/2018[2013-14]Status: DisposedITAT Visakhapatnam28 Nov 2018AY 2013-14

Bench: Shri V. Durga Rao, Hon’Ble & Shri D.S. Sunder Singh, Hon’Ble

For Appellant: Shri G.V.N. Hari – AdvocateFor Respondent: Mrs. Suman Malik – Sr.DR
Section 143(1)Section 148

…me Tax authorities has no jurisdiction to meddle in the matter either by directing the assessee to maintain its account in a particular manner or adopt a different method for valuing work-in-progress. Hon'ble Supreme Court in Bharat Earth Movers vs CIT (2000) 245 ITR 428 (SC) considered the general principles regarding allowance of business expenditure and the difference between accrued and contingent liabilities. It was held that “if a business liability has definitely arisen in the accounting year, the deduction should be allowed although the liability may have to be quantified and discharged at a future date.…

The Deputy Commissioner of Income Tax, Circle-1, Kakinada vs. Sar Chandra Environ Solutions Private Limited, Kakinada

In the result, appeals filed by the Revenue and the cross objections filed by the assessee are dismissed

ITA 147/VIZ/2018[2010-11]Status: DisposedITAT Visakhapatnam28 Nov 2018AY 2010-11

Bench: Shri V. Durga Rao, Hon’Ble & Shri D.S. Sunder Singh, Hon’Ble

For Appellant: Shri G.V.N. Hari – AdvocateFor Respondent: Mrs. Suman Malik – Sr.DR
Section 143(1)Section 148

…me Tax authorities has no jurisdiction to meddle in the matter either by directing the assessee to maintain its account in a particular manner or adopt a different method for valuing work-in-progress. Hon'ble Supreme Court in Bharat Earth Movers vs CIT (2000) 245 ITR 428 (SC) considered the general principles regarding allowance of business expenditure and the difference between accrued and contingent liabilities. It was held that “if a business liability has definitely arisen in the accounting year, the deduction should be allowed although the liability may have to be quantified and discharged at a future date.…

ACIT, Circle- 20(1), New Delhi vs. Punjab National Bank, New Delhi

In the result appeal filed by Revenue stands dismissed

ITA 7106/DEL/2017[2012-13]Status: DisposedITAT Delhi28 Nov 2018AY 2012-13

Bench: Smt. Beena A Pillai & Shri Prashant Maharishiay: 2012-13 Punjab National Bank The Acit, Circle 20(1) Ho: Finance Division C.R. Building I.T.O. Vs. Ho:5, Sansad Marg New Delhi New Delhi 110 001 Ay: 2012-13 The Acit, Circle 20(1) Punjab National Bank C.R. Building I.T.O. Ho: Finance Division Vs. New Delhi Ho:5, Sansad Marg New Delhi 110 001 (Appellant) (Respondent)

For Appellant: Sh. S. Krishnan, C.A. and Sh. Raj Kumar, AdvFor Respondent: Smt. Sulekha Verma, CIT, D.R
Section 14Section 142Section 143(1)Section 143(2)Section 14ASection 271(1)Section 36(1)(vii)Section 43B

…urt in case of Exide Industries Ltd vs. Union of India reported in 292 ITR 470 had struck down constitutional validity of section 43B (f) of the Act being arbitrary, unconstitutional and de hors the facts of decision in case of Bharat Earth Movers reported in 245 ITR 428. 9.2. On contrary, Ld.Sr.DR placed reliance upon orders passed by authorities below and submitted that, certain deductions could be allowed, only on actual payment. He placed reliance upon decision of coordinate Bench in the case of Nainital Almora Kshetriya Bank in ITA No. 4240/Del/2012, ITA No. 5234/Del/2012 and ITA No. 5312/Del/2013 for Assess…

Punjab National Bank, New Delhi vs. ACIT, New Delhi

In the result appeal filed by Revenue stands dismissed

ITA 1519/DEL/2016[2012-13]Status: DisposedITAT Delhi28 Nov 2018AY 2012-13

Bench: Smt. Beena A Pillai & Shri Prashant Maharishiay: 2012-13 Punjab National Bank The Acit, Circle 20(1) Ho: Finance Division C.R. Building I.T.O. Vs. Ho:5, Sansad Marg New Delhi New Delhi 110 001 Ay: 2012-13 The Acit, Circle 20(1) Punjab National Bank C.R. Building I.T.O. Ho: Finance Division Vs. New Delhi Ho:5, Sansad Marg New Delhi 110 001 (Appellant) (Respondent)

For Appellant: Sh. S. Krishnan, C.A. and Sh. Raj Kumar, AdvFor Respondent: Smt. Sulekha Verma, CIT, D.R
Section 14Section 142Section 143(1)Section 143(2)Section 14ASection 271(1)Section 36(1)(vii)Section 43B

…urt in case of Exide Industries Ltd vs. Union of India reported in 292 ITR 470 had struck down constitutional validity of section 43B (f) of the Act being arbitrary, unconstitutional and de hors the facts of decision in case of Bharat Earth Movers reported in 245 ITR 428. 9.2. On contrary, Ld.Sr.DR placed reliance upon orders passed by authorities below and submitted that, certain deductions could be allowed, only on actual payment. He placed reliance upon decision of coordinate Bench in the case of Nainital Almora Kshetriya Bank in ITA No. 4240/Del/2012, ITA No. 5234/Del/2012 and ITA No. 5312/Del/2013 for Assess…

M/S. Technico Agri Sciences Ltd., Chandigarh vs. ACIT, New Delhi

In the result, all the five appeals of the assessee stand

ITA 3114/DEL/2013[2006-07]Status: DisposedITAT Delhi19 Nov 2018AY 2006-07

Bench: Shri G.D. Agrawal & Shri Sudhanshu Srivastavaassessment Year: 2001-02 Assessment Year: 2003-04 Assessment Year: 2004-05 Assessment Year: 2005-06 Assessment Year: 2006-07

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Shri Pradeep Singh Gautam, Sr.DR
Section 143(3)

…debenture holder to receive the payment upfront, liability of the assessee to make the payment in that very year, on exercising of this option, has arisen and this liability was to pay the interest @ Rs. 55 per debenture. In Bharat Earth Movers v. CIT [2000] 245 ITR 428/112 Taxman 61 (SC), this Court had categorically held that if a business liability has arisen in the accounting year, the deduction should be allowed even if such a liability may have to be quantified and discharged at a future date. …………. 16. Judgment in Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC) was…

M/S. Technico Agri Sciences Ltd., Chandigarh vs. ACIT, New Delhi

In the result, all the five appeals of the assessee stand

ITA 3113/DEL/2013[2005-06]Status: DisposedITAT Delhi19 Nov 2018AY 2005-06

Bench: Shri G.D. Agrawal & Shri Sudhanshu Srivastavaassessment Year: 2001-02 Assessment Year: 2003-04 Assessment Year: 2004-05 Assessment Year: 2005-06 Assessment Year: 2006-07

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Shri Pradeep Singh Gautam, Sr.DR
Section 143(3)

…debenture holder to receive the payment upfront, liability of the assessee to make the payment in that very year, on exercising of this option, has arisen and this liability was to pay the interest @ Rs. 55 per debenture. In Bharat Earth Movers v. CIT [2000] 245 ITR 428/112 Taxman 61 (SC), this Court had categorically held that if a business liability has arisen in the accounting year, the deduction should be allowed even if such a liability may have to be quantified and discharged at a future date. …………. 16. Judgment in Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC) was…

M/S. Technico Agri Sciences Ltd., Chandigarh vs. ACIT, New Delhi

In the result, all the five appeals of the assessee stand

ITA 3112/DEL/2013[2004-05]Status: DisposedITAT Delhi19 Nov 2018AY 2004-05

Bench: Shri G.D. Agrawal & Shri Sudhanshu Srivastavaassessment Year: 2001-02 Assessment Year: 2003-04 Assessment Year: 2004-05 Assessment Year: 2005-06 Assessment Year: 2006-07

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Shri Pradeep Singh Gautam, Sr.DR
Section 143(3)

…debenture holder to receive the payment upfront, liability of the assessee to make the payment in that very year, on exercising of this option, has arisen and this liability was to pay the interest @ Rs. 55 per debenture. In Bharat Earth Movers v. CIT [2000] 245 ITR 428/112 Taxman 61 (SC), this Court had categorically held that if a business liability has arisen in the accounting year, the deduction should be allowed even if such a liability may have to be quantified and discharged at a future date. …………. 16. Judgment in Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC) was…

M/S. Technico Agri Sciences Ltd., Chandigarh vs. ACIT, New Delhi

In the result, all the five appeals of the assessee stand

ITA 3111/DEL/2013[2003-04]Status: DisposedITAT Delhi19 Nov 2018AY 2003-04

Bench: Shri G.D. Agrawal & Shri Sudhanshu Srivastavaassessment Year: 2001-02 Assessment Year: 2003-04 Assessment Year: 2004-05 Assessment Year: 2005-06 Assessment Year: 2006-07

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Shri Pradeep Singh Gautam, Sr.DR
Section 143(3)

…debenture holder to receive the payment upfront, liability of the assessee to make the payment in that very year, on exercising of this option, has arisen and this liability was to pay the interest @ Rs. 55 per debenture. In Bharat Earth Movers v. CIT [2000] 245 ITR 428/112 Taxman 61 (SC), this Court had categorically held that if a business liability has arisen in the accounting year, the deduction should be allowed even if such a liability may have to be quantified and discharged at a future date. …………. 16. Judgment in Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC) was…

M/S Technico Agri Sciences Ltd., Chandigarh vs. ACIT, New Delhi

In the result, all the five appeals of the assessee stand

ITA 5847/DEL/2010[2001-02]Status: DisposedITAT Delhi19 Nov 2018AY 2001-02

Bench: Shri G.D. Agrawal & Shri Sudhanshu Srivastavaassessment Year: 2001-02 Assessment Year: 2003-04 Assessment Year: 2004-05 Assessment Year: 2005-06 Assessment Year: 2006-07

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Shri Pradeep Singh Gautam, Sr.DR
Section 143(3)

…debenture holder to receive the payment upfront, liability of the assessee to make the payment in that very year, on exercising of this option, has arisen and this liability was to pay the interest @ Rs. 55 per debenture. In Bharat Earth Movers v. CIT [2000] 245 ITR 428/112 Taxman 61 (SC), this Court had categorically held that if a business liability has arisen in the accounting year, the deduction should be allowed even if such a liability may have to be quantified and discharged at a future date. …………. 16. Judgment in Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC) was…

DCIT Cir 2, Kalyan vs. Medirays Corporation, Thane

In the result, the appeal filed by the revenue is dismissed

ITA 4157/MUM/2017[2013-14]Status: DisposedITAT Mumbai31 Oct 2018AY 2013-14

Bench: Shri Shamim Yahya & Shri Ravish Soodthe Dy. Commissioner Of M/S Medirays Corporation, B-9, Income Tax, Circle-2, Rukma Udyog Nagar, Kalyan, 2Nd Floor, Mohan Plaza, Vs. Mumbai Nashik Road, Nh-3, Khadakpada, Wayale Nagar, Opp. Asangoan, Taluka, Kalyan (W), 421301 Shahpur, Dist. Thane Pan – Aagfm2401F Appellant Respondent

For Appellant: Shri Chaitanya Anjaria, D.RFor Respondent: Dr. P. Daniel, A.R
Section 143(1)Section 143(2)Section 143(3)Section 37(1)

…ed from its past results. Further, the A.O observed that the P a g e | 3 ITA No. 4157/Mum/2017 A.Y 2013-14 The Dy. Commissioner of Income Tax Vs. M/s Medirays Corporation judgment of the Hon’ble Supreme Court in the case of Bharat Earth Movers Vs. CIT (2000) (245 ITR 428) (SC) and Rotork Controls India OVT Ltd. Vs. CIT (314 ITR 62) (SC), relied upon by the assessee to buttress his aforesaid claim were distinguishable on facts. On the basis of his aforesaid deliberations the A.O disallowed the assessees claim of provision of Rs.1,81,67,595/- for warranty expenses. Before parting, it was also observed by the A.O th…

DCIT Corporate Circle 1 (1), Chennai vs. M/S East Coast Constructions & Industries Limited, Chennai

In the result, the appeal filed by the Revenue is allowed for statistical purposes

ITA 1442/CHNY/2018[2010-11]Status: DisposedITAT Chennai24 Oct 2018AY 2010-11

Bench: Shri Abraham P. George & Shri Duvvuru Rl Reddyआयकर अपील सं./I T.A. No. 1442/Chny/2018 िनधा"रण वष"/Assessment Year:2010-11 The Deputy Commissioner Of M/S. East Coast Constructions & Income Tax, Central Circle 1(1), Vs. Industries Ltd., No. 4, Moores Road, Chennai – 34. Chennai 600 006. [Pan:Aaace1662P] (Appellant) (Respondent) अपीलाथ" की ओर से / Appellant By : Ms. Tripurasundari, Cit ""थ" की ओर से/Respondent By : Shri G. Baskar, Advocate सुनवाई की तारीख/ Date Of Hearing : 11.09.2018 घोषणा की तारीख /Date Of Pronouncement : 24.10.2018 आदेश /O R D E R Per Duvvuru Rl Reddy: This Appeal Filed By The Revenue Is Directed Against The Order Of The Commissioner Of Income Tax (Appeals) 6, Chennai Dated 30.01.2018 Relevant To The Assessment Year 2010-11. The Only Effective Ground Raised In The Appeal Of The Revenue Is That The Ld. Cit(A) Has Erred In Deleting The Disallowance Of ₹.25,24,97,133/- Towards Expenses Relatable To The Retention Money Withheld By The Contractees.

For Appellant: Ms. Tripurasundari, CITFor Respondent: Shri G. Baskar, Advocate
Section 143(3)Section 263

…preme Court in the case of Rotork Controls India Pvt. Ltd vs CIT, 314 ITR 62, held that the provision made by the assessee for warranty claims on the basis of past experience is allowable deduction u/s 37 of the Act. In the case of Bharat Earth Movers vs CIT, 245 ITR 428, the Supreme Court held that where the assessee has incurred expenditure which is more than the provision for warranty obligation made in the books of account, it cannot be 6 I.T.A. No. 1442/Chny/18 said that the provision made by the assessee is not capable of being estimated with the reasonable certainty though actual quantification was not po…

ACIT 3(1)(2), Mumbai vs. Gran Electronics P.Ltd, Mumbai

ITA 3518/MUM/2017[2011-12]Status: DisposedITAT Mumbai22 Oct 2018AY 2011-12

Bench: Shri Joginder Singh & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No.3518/Mum/2017 (नििाारण वर्ा / Assessment Year : 2011-12) बिाम/ Acit 3(1)(2) M/S. Gran Electronics R.No 607, 6Th Floor, Pvt. Ltd., Aayakar Bhavan, C-171, Mittal Court, V. Mumbai-400020 Nariman Point, Mumbai-400021 स्थायी ऱेखा सं./ Pan: Aaach0383A (अपीऱाथी /Appellant) .. (प्रत्यथी / Respondent) Revenue By: Shri. Chaudhary Arun Kumar Singh Assessee By : Shri. Mayank Chauhan & Shri. Bhupendra Karkhanis सुनवाई की तारीख /Date Of Hearing : 10.10.2018 घोषणा की तारीख /Date Of Pronouncement :22.10.2018 आदेश / O R D E R Per Ramit Kochar: This Appeal, Filed By Revenue, Being Ita No. 3518/Mum/2017, Is Directed Against Appellate Order Dated 27.01.2017 Passed By Learned Commissioner Of Income Tax (Appeals)-8, Mumbai (Hereinafter Called “The Cit(A)”), For Assessment Year 2011-12, The Appellate Proceedings Had Arisen Before Learned Cit(A) From Assessment Order Dated 10.03.2014 Passed By Learned Assessing Officer (Hereinafter Called “The Ao”) U/S 143(3) Of The Income-Tax Act, 1961 (Hereinafter Called “The Act”) For Ay 2011-12. I.T.A. No.3518/Mum/2017

For Appellant: Shri. Mayank Chauhan &For Respondent: Shri. Chaudhary Arun Kumar
Section 115Section 115JSection 143(3)

…ar and is allowable on estimate on the basis of past record. 1. IBM India Ltd v. CIT(A) 105 ITD 1 (Bang.) 2. Voltas Ltd. v. DCIT 64 ITD 232 (Mum) 3. Majestic Auto Ltd. 296 ITR 309 P&H 4. Usha Martin Inds Ltd. 288 ITR 63, AT., Cal. S.B. 5. Bharat Earth Movers, 245 ITR 428 S, C. which held that liability had actually arisen and deduction is allowable even if quantified and paid later. 6. Rotork Controls (I) Ltd. 314 ITR 62 S.C. - allowed as integral part of sale price. Thus, warranty provision cannot be said to be a provision to meet an unascertained liability and hence does not get covered under clause (c) of the…