Brooke Bond India Ltd. v. CIT

225 ITR 798Supreme Court of India1997#390 most cited

What is Brooke Bond India Ltd. v. CIT authority for?

Expenditure incurred for increasing a company's share capital or expanding its capital base, such as expenses related to the issue of shares, constitutes capital expenditure. Such expenses are not deductible as revenue expenditure under Section 37(1) of the Income-tax Act, 1961, even if they incidentally benefit the business.

228

judgments rely on this decision, according to BharatTax’s citation analysis of 367,515 Indian tax judgments — from 2006 to 2026.

Also referred to as

Brooke Bond India Ltd. v. CIT · Section 37(1) · capital expenditure · revenue expenditure · share issue expenses · increase in capital · capital base expansion · deductibility · professional fees · enduring benefit

Also reported as

91 Taxmann 26

Sections most often in play

Section 37(1)Section 143(3)Section 14ASection 10BSection 28Section 35DSection 43(5)Section 143(1)
Read the full judgment

Issues it is cited on

section 35dspeculation losssection 43(5)strategic investmentenduring benefitsection 35capital expenditurerevenue expendituredisallowance under section 14abook profitscommercial expediencysection 37(1)

Judgments citing Brooke Bond India Ltd. v. CIT

M/S. Great Eastern Energy Corporation Ltd., Gurgaon vs. DCIT, New Delhi

The appeal of the assessee are allowed

ITA 5728/DEL/2016[2012-13]Status: DisposedITAT Delhi20 Nov 2019AY 2012-13

Bench: Shri Kuldip Singh & Shri Prashant Maharishidcit, Vs. Great Eastern Energy Circle-10(2), Corporation Ltd, New Delhi Signature Towers-A, 14Th Floor, South City, Nh-8, Gurgaon Pan: Aaacg3345F (Appellant) (Respondent)

For Appellant: Shri Ravi Sharma, CAFor Respondent: Smt Naina Soin Kapil, Sr
Section 143Section 37Section 37(1)

…onourable Supreme Court in case of CIT vs. General Insurance Corp 286 ITR 232 wherein the honourable Supreme Court has also considered and distinguished the decision in case of Punjab State industrial development Corp Ltd 225 ITR 792 and Brooke Bond India Ltd 225 ITR 798 for the reason that in the said cases expenditure was incurred for the purpose of increasing company share capital by the issue of fresh shares and there was in flow of fresh funds. 10. We have carefully considered the rival contention and perused the orders of the lower authorities. In the present case, the appellant has shifted its global depos…

M/S. Great Estern Energy Corporation Ltd., Gurgaon vs. DCIT, New Delhi

The appeal of the assessee are allowed

ITA 3360/DEL/2015[2011-12]Status: DisposedITAT Delhi20 Nov 2019AY 2011-12

Bench: Shri Kuldip Singh & Shri Prashant Maharishidcit, Vs. Great Eastern Energy Circle-10(2), Corporation Ltd, New Delhi Signature Towers-A, 14Th Floor, South City, Nh-8, Gurgaon Pan: Aaacg3345F (Appellant) (Respondent)

For Appellant: Shri Ravi Sharma, CAFor Respondent: Smt Naina Soin Kapil, Sr
Section 143Section 37Section 37(1)

…onourable Supreme Court in case of CIT vs. General Insurance Corp 286 ITR 232 wherein the honourable Supreme Court has also considered and distinguished the decision in case of Punjab State industrial development Corp Ltd 225 ITR 792 and Brooke Bond India Ltd 225 ITR 798 for the reason that in the said cases expenditure was incurred for the purpose of increasing company share capital by the issue of fresh shares and there was in flow of fresh funds. 10. We have carefully considered the rival contention and perused the orders of the lower authorities. In the present case, the appellant has shifted its global depos…

DCIT, New Delhi vs. M/S. Great Eastern Energy Corporation Ltd., Gurgaon

The appeal of the assessee are allowed

ITA 3310/DEL/2015[2011-12]Status: DisposedITAT Delhi20 Nov 2019AY 2011-12

Bench: Shri Kuldip Singh & Shri Prashant Maharishidcit, Vs. Great Eastern Energy Circle-10(2), Corporation Ltd, New Delhi Signature Towers-A, 14Th Floor, South City, Nh-8, Gurgaon Pan: Aaacg3345F (Appellant) (Respondent)

For Appellant: Shri Ravi Sharma, CAFor Respondent: Smt Naina Soin Kapil, Sr
Section 143Section 37Section 37(1)

…onourable Supreme Court in case of CIT vs. General Insurance Corp 286 ITR 232 wherein the honourable Supreme Court has also considered and distinguished the decision in case of Punjab State industrial development Corp Ltd 225 ITR 792 and Brooke Bond India Ltd 225 ITR 798 for the reason that in the said cases expenditure was incurred for the purpose of increasing company share capital by the issue of fresh shares and there was in flow of fresh funds. 10. We have carefully considered the rival contention and perused the orders of the lower authorities. In the present case, the appellant has shifted its global depos…

Exind Trading P. Ltd, Mumbai vs. ITO 6(2)(4), Mumbai

In the result, this appeal by the assessee stands allowed for statistical purposes

ITA 351/MUM/2016[2012-13]Status: DisposedITAT Mumbai07 Nov 2019AY 2012-13

Bench: Shri Shamim Yahya & Shri Ravish Sood: A.Y : 2012-13

For Appellant: Shri Dharmesh ShahFor Respondent: Shri Rajeev Gubgotra
Section 234BSection 271(1)(c)Section 68

…on with increase in authorised capital. It was also asked to why the same be not treated as capital expense and disallowed as business expenses in view of the decision of the Hon'ble Supreme court in the case of M/s. Brookbond India Ltd. Vs CIT as reported in 225 ITR 798 (SC). The assessee through its AR submitted that a sum of Rs.34,600/- was paid as stamp duty on allotment of share in connection with increase in authorised share capital. The AR admitted that same may be disallowed. Accordingly, a sum of Rs.34,600/- is disallowed as being capital in nature, and added back to the total income of the assessee.” 4…

DCIT - CC - 2(2), Mumbai vs. M/S Empower India Limited, Mumbai

ITA 3205/MUM/2019[2011-12]Status: DisposedITAT Mumbai23 Oct 2019AY 2011-12

Bench: Sri Mahavir Singh, Jm & Sri Rajesh Kumar, Am आयकर अपील सुं/ Ita No. 3205/Mum/2019 (यिर्ाारण बर्ा / Assessment Year 2011-12) आयकर अपील सुं/ Ita No. 5584/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) The Dy. Commissioner Of Income Tax, ……………. Appellant Central Circle 2(2), Room No. 806, 8Th Floor, / अपीलाथी Old Cgo Annex Bldg, M.K. Road, Mumbai-400 020 V/S M/S Empower India Ltd. 25/25A, 327, Nawab Building, 2Nd Floor, …………….Respondent Mumbai-400 001 / प्रत्यथााी स्थायी लेखा िं /Pan – Aaach3967N आयकर अपील सुं/ Ita No. 5207/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) M/S Empower India Ltd. 25/25A, 327, Nawab Building, 2Nd Floor, ……………. Appellant Mumbai-400 001 / अपीलाथी स्थायी लेखा िं /Pan – Aaach3967N V/S The Dy. Commissioner Of Income Tax, Central Circle 2(2), Room No. 806, 8Th Floor, …………….Respondent Old Cgo Annex Bldg, M.K. Road, / प्रत्यथााी Mumbai-400 020 5584 & 5207/Mum/2017 2 | P A G E

For Appellant: Shri Neeraj Mangla, ARFor Respondent: Shri R. Manjunatha Swamy, DR
Section 131Section 143(3)Section 153C

…आयकर अपीलीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI श्री महावीर स िंह, न्याययक दस्य एविं श्री राजेश कुमार लेखा दस्य के मक्ष। BEFORE SRI MAHAVIR SINGH, JM AND SRI RAJESH KUMAR, AM आयकर अपील सुं/ ITA No. 3205/Mum/2019 (यिर्ाारण बर्ा / Assessment Year 2011-12) आयकर अपील सुं/ ITA No. 5584/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) The Dy. Commissioner of Income Tax, ……………. Appellant Central Circle 2(2), Room No. 806, 8th Floor, / अपीलाथी Old CGO Annex Bldg, M.K. Road, Mumbai-400 020 v/s M/s Empower India Ltd. 25/25A, 327, Nawab Building, 2nd Floor, …………….Respon…

Deputy Commissioner of Income Tax Central Circle-2(2), Mumbai vs. Empower India Limited, Mumbai

ITA 5584/MUM/2017[2011-12]Status: DisposedITAT Mumbai23 Oct 2019AY 2011-12

Bench: Sri Mahavir Singh, Jm & Sri Rajesh Kumar, Am आयकर अपील सुं/ Ita No. 3205/Mum/2019 (यिर्ाारण बर्ा / Assessment Year 2011-12) आयकर अपील सुं/ Ita No. 5584/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) The Dy. Commissioner Of Income Tax, ……………. Appellant Central Circle 2(2), Room No. 806, 8Th Floor, / अपीलाथी Old Cgo Annex Bldg, M.K. Road, Mumbai-400 020 V/S M/S Empower India Ltd. 25/25A, 327, Nawab Building, 2Nd Floor, …………….Respondent Mumbai-400 001 / प्रत्यथााी स्थायी लेखा िं /Pan – Aaach3967N आयकर अपील सुं/ Ita No. 5207/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) M/S Empower India Ltd. 25/25A, 327, Nawab Building, 2Nd Floor, ……………. Appellant Mumbai-400 001 / अपीलाथी स्थायी लेखा िं /Pan – Aaach3967N V/S The Dy. Commissioner Of Income Tax, Central Circle 2(2), Room No. 806, 8Th Floor, …………….Respondent Old Cgo Annex Bldg, M.K. Road, / प्रत्यथााी Mumbai-400 020 5584 & 5207/Mum/2017 2 | P A G E

For Appellant: Shri Neeraj Mangla, ARFor Respondent: Shri R. Manjunatha Swamy, DR
Section 131Section 143(3)Section 153C

…आयकर अपीलीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI श्री महावीर स िंह, न्याययक दस्य एविं श्री राजेश कुमार लेखा दस्य के मक्ष। BEFORE SRI MAHAVIR SINGH, JM AND SRI RAJESH KUMAR, AM आयकर अपील सुं/ ITA No. 3205/Mum/2019 (यिर्ाारण बर्ा / Assessment Year 2011-12) आयकर अपील सुं/ ITA No. 5584/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) The Dy. Commissioner of Income Tax, ……………. Appellant Central Circle 2(2), Room No. 806, 8th Floor, / अपीलाथी Old CGO Annex Bldg, M.K. Road, Mumbai-400 020 v/s M/s Empower India Ltd. 25/25A, 327, Nawab Building, 2nd Floor, …………….Respon…

Empower India Limited, Mumbai vs. Deputy Commissioner of Income Tax Circle-2(1), Mumbai

ITA 5207/MUM/2017[2011-12]Status: DisposedITAT Mumbai23 Oct 2019AY 2011-12

Bench: Sri Mahavir Singh, Jm & Sri Rajesh Kumar, Am आयकर अपील सुं/ Ita No. 3205/Mum/2019 (यिर्ाारण बर्ा / Assessment Year 2011-12) आयकर अपील सुं/ Ita No. 5584/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) The Dy. Commissioner Of Income Tax, ……………. Appellant Central Circle 2(2), Room No. 806, 8Th Floor, / अपीलाथी Old Cgo Annex Bldg, M.K. Road, Mumbai-400 020 V/S M/S Empower India Ltd. 25/25A, 327, Nawab Building, 2Nd Floor, …………….Respondent Mumbai-400 001 / प्रत्यथााी स्थायी लेखा िं /Pan – Aaach3967N आयकर अपील सुं/ Ita No. 5207/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) M/S Empower India Ltd. 25/25A, 327, Nawab Building, 2Nd Floor, ……………. Appellant Mumbai-400 001 / अपीलाथी स्थायी लेखा िं /Pan – Aaach3967N V/S The Dy. Commissioner Of Income Tax, Central Circle 2(2), Room No. 806, 8Th Floor, …………….Respondent Old Cgo Annex Bldg, M.K. Road, / प्रत्यथााी Mumbai-400 020 5584 & 5207/Mum/2017 2 | P A G E

For Appellant: Shri Neeraj Mangla, ARFor Respondent: Shri R. Manjunatha Swamy, DR
Section 131Section 143(3)Section 153C

…आयकर अपीलीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI श्री महावीर स िंह, न्याययक दस्य एविं श्री राजेश कुमार लेखा दस्य के मक्ष। BEFORE SRI MAHAVIR SINGH, JM AND SRI RAJESH KUMAR, AM आयकर अपील सुं/ ITA No. 3205/Mum/2019 (यिर्ाारण बर्ा / Assessment Year 2011-12) आयकर अपील सुं/ ITA No. 5584/Mum/2017 (यिर्ाारण बर्ा / Assessment Year 2011-12) The Dy. Commissioner of Income Tax, ……………. Appellant Central Circle 2(2), Room No. 806, 8th Floor, / अपीलाथी Old CGO Annex Bldg, M.K. Road, Mumbai-400 020 v/s M/s Empower India Ltd. 25/25A, 327, Nawab Building, 2nd Floor, …………….Respon…

Riddhi Steels & Tubes Limited, Ahmedabad vs. DCIT, Circle-3(1)(2), Ahmedabad

ITA 116/AHD/2018[2012-13]Status: DisposedITAT Ahmedabad19 Sept 2019AY 2012-13

Bench: Shri Kul Bharat & Shri Pradip Kumar Kedia

For Appellant: Shri Satish Solanki, Sr.D.R

…आयकर अपील"य अ"धकरण, अहमदाबाद "यायपीठ ‘A’ अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER आयकर अपील सं./I.T.A. No. 116/Ahd/2018 ("नधा"रण वष" / Assessment Year : 2012-13) Riddhi Steel & Tube Deputy Commissioner of बनाम/ Limited Income-tax Vs. 83-84, Village Kamod Circle – 3(1)(2), Piplaj, Pirana Road, Ahmedabad Aslali, Piplaj, Ahmedabad 382 427 "थायी लेखा सं./जीआइआर सं./PAN/GIR No. : AACCR0175J .. (अपीलाथ" /Appellant) (""यथ" / Respondent) Shri P. B. Parmar, A.R. अपीलाथ" ओर से / Appellant by : Shri Satish…

Assistant Commissioner of Income Tax 2(3)(2), Mumbai vs. Kotak Mahindra Bank Limited, Mumbai

In the result, both the appeals filed by the revenue are dismissed

ITA 781/MUM/2018[2013-14]Status: DisposedITAT Mumbai27 Aug 2019AY 2013-14

Bench: Shri Shamim Yahya & Shri Pawan Singh

Section 143(3)Section 14ASection 36Section 36(1)(vii)

…on to issue of shares to employees; they are not relatable to profits and gains arising or accruing from a business / trade; the Apex Court in the case of Punjab State Industrial Development Corpn Ltd (1997) 225 ITR 792 (SC) and Brooke Bond India Ltd (1997) 225 ITR 798 (SC) have held that expenditure resulting in increase in capital is not allowable deduction even if such expenditure may incidentally help in business of the company; (ii) ESOP discount does not diminish trading / business receipts of the issuing company. The company does not suffer any pecuniary detriment. To claim a charge against income, it…

Vatika Ltd., New Delhi vs. DCIT, New Delhi

ITA 1512/DEL/2014[2008-09]Status: DisposedITAT Delhi14 Aug 2019AY 2008-09

Bench: Smt Beena A Pillai & Shri Prashant Maharishi

For Appellant: Shri C.S. Aggarwal, Sr. AdvFor Respondent: Smt Naina Soin Kapil, Sr. DR
Section 195Section 250Section 251(1)(a)Section 251(2)Section 271Section 40a

…(A) has erred in holding that the expenditure incurred of Rs. 13,48,31,985/- represented capital expenditure and had nothing to do with the profit of the company The judgment relied upon by the CIT (A) in the case of Brooke Bond India Ltd. vs. CIT reported in 225 ITR 798 has absolutely no application to the facts of the instant case 11. That, while determining the claim of the assessee that, expenditure incurred was allowable he has brushed aside the assessee s submissions contained in para 10 in the written submissions before the CIT(A). 12. The findings of the CIT (A) in confirming the disallowance that, 1% upf…

Sowraj Investments Pvt Ltd, Chennai vs. DCIT, Corp Circle-6(2), Chennai

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

ITA 3175/CHNY/2018[2013-14]Status: DisposedITAT Chennai08 Aug 2019AY 2013-14

Bench: Shri Inturi Rama Rao & Shri Duvvuru Rl Reddy]

For Appellant: Mr.M.Viswanathan,C.A +For Respondent: Mr.R.Clement Ramesh Kumar
Section 143(3)Section 14A

…,23,54,871/- and also disallowed a sum of Rs.29,330/- being the expenditure incurred ROC filing :- 4 -: charge, holding it be capital nature placing reliance in the judgement of Hon”ble Supreme Court in the case of Brooke Bond India Ltd., Vs. C.I.T in (1997) 225 ITR 798(SC). Further, the Assessing Officer had not allowed the short term capital loss of Rs.6,68,80,000/- to carry forward in respect of forfeiture of share Warrants as short term capital loss. Being aggrieved, the assessee preferred an appeal before the ld.CIT(A), who vide impugned order confirmed the additions. Being aggrieved with the order of the…

Bright Autoplast Ltd., Ahmedabad vs. Asstt. CIT, Circle-1(1)(1), Ahmedabad

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

ITA 1990/AHD/2015[2008-09]Status: DisposedITAT Ahmedabad28 Jun 2019AY 2008-09

Bench: Shri Mahavir Prasad & Shri Waseem Ahmedsl.

For Appellant: Ms. Sonia Kumar Sr.DRFor Respondent: Shri Milin Mehta, AR
Section 234BSection 234CSection 234DSection 271(1)(c)Section 35D

…ditures allowable u/s.35D of the Act. 1) CIT vs. Muti Metals Ltd. (1991) 188 ITR 151 (Raj) 2) ACIT vs. Fascel Ltd. (2009) 120 TTJ 289 (Delhi) The learned Assessing Officer & CIT(A) relied upon the Apex Court decision of Brooke Bond India Ltd. vs. CIT (1997) 225 ITR 798 and disallowed the claim of preliminary expenditure claimed by the Appellant. It is submitted that question raised before the Hon’ble SC was whether the expenditure incurred on expansion of capital base is capital or revenue in nature. The SC did nto consider the question whether preliminary expenses u/s.35D of the Act were allowable or not. The…

The ACIT, Corp Circle-1(1), Kochi, Ernakulam vs. Appolo Tyres Ltd, Ernakulam

In the result, the appeal filed by the Revenue in ITA No

ITA 247/COCH/2018[2006-07]Status: DisposedITAT Cochin21 Mar 2019AY 2006-07

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 80I

…ppeal before us in ITA No.249/Coch/2018 by way of additional ground. 7.6.1 With regard to allowability of expenditure u/s. 37(1), we are of the opinion that this issue was already settled by the Supreme Court in the case of Brooke Bond India Ltd. vs. CIT (225 ITR 798) wherein it was held that expenditure incurred by a company in connection with issue of shares, with a view to increase its share capital, is directly related to the expansion of the capital base of the company, and is capital expenditure, even though it may incidentally help in the business of the company and in the profit making. Being so, we…

Adani Agri Fresh Ltd., Ahmedabad vs. The Dy.CIT, Circle-1, Ahmedabad

In the result the appeal and the Cross Objection of the assessee are partly allowed

ITA 1653/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad19 Mar 2019AY 2010-11

Bench: Shri Mahavir Prasad & Shri Waseem Ahmedआयकर अपील सं./Ita No.1653/Ahd/2015 "नधा"रण वष"/Asstt. Year: 2010-2011 & C.O. 201/Ahd/2015 (In Ita No.2720/Ahd/2015) "नधा"रण वष"/Asstt. Year: 2011-2012 Adani Agri Fresh Ltd., D.C.I.T, Adani House, Vs. Circle-1, Nr. Mithakhali Six Roads, Ahmedabad. Navrangpura, Ahmedabad. Pan: Aafca0413P

Section 10Section 143(3)Section 14ASection 271Section 271(1)(c)Section 35DSection 41(1)

…tion for preliminary expenses of Rs.6,27,066 u/s. 35D after following his predecessors upholding similar disallowances in earlier assessment years. He ought to have appreciated, inter alia, that the decisions of the Supreme Court in Brooke Bond India Limited (225 ITR 798 and of the Gujarat High Court in Vareli Textiles Limited (284 ITR 238) holding that share issue expenses were capital in nature and, therefore, not deductible as revenue expenses as claimed by the assesses in those cases, were not relevant on the issue of their deductibility u/s. 35D (which made provision for deduction of expenses on amortization…

M/S.Inditrade Capital Ltd (Formerly Known As Jrg Securities Ltd), Kochi vs. The Adcit, Range-1, Ochi, Kochi

ITA 357/COCH/2017[2008-09]Status: DisposedITAT Cochin01 Mar 2019AY 2008-09

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 36(1)(va)Section 37(1)

…nt order disallowed the entire claim of expenses on IPO (Initial Public Offer) treating the same as capital expenditure. The Assessing officer placed reliance on the judgment of the Hon’ble Supreme Court in the case of Brooke Bond (India) Ltd. v. CIT reported 225 ITR 798 (SC). On the other hand it was argued on behalf of the appellant that only direct expenses such as payment to…

The ITO, Corporate Ward1(1), Kochi vs. M/S.Jrg Securities(Presently Inditrade Capital Ltd), Kochi

ITA 356/COCH/2017[2008-09]Status: DisposedITAT Cochin01 Mar 2019AY 2008-09

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 36(1)(va)Section 37(1)

…nt order disallowed the entire claim of expenses on IPO (Initial Public Offer) treating the same as capital expenditure. The Assessing officer placed reliance on the judgment of the Hon’ble Supreme Court in the case of Brooke Bond (India) Ltd. v. CIT reported 225 ITR 798 (SC). On the other hand it was argued on behalf of the appellant that only direct expenses such as payment to…

ITO, Ward-10(4), Kolkata vs. M/S Topaz Enclave Pvt.Ltd., Kolkata

In the result, the appeal of the revenue is dismissed

ITA 2271/KOL/2016[2012-13]Status: DisposedITAT Kolkata20 Feb 2019AY 2012-13

Bench: Sri J. Sudhakar Reddy & Sri S.S. Viswanethra Ravii.T.A. No. 2271/Kol/2016 Assessment Year: 2012-13 Ito, Ward-10(4), Kolkata.................................………....………………...…………………….….Appellant

Section 143(3)Section 250Section 68

…Year: 2012-13 M/s Topaz Enclave Pvt. Ltd view was affirmed in the cases of Punjab State Industrial Corporation Ltd. reported in 225 ITR 792 wherein it is held that share premium is in the nature of capital and in the case of Brooke Bond India Ltd. reported in 225 ITR 798. The A.O had not questioned the identity of the shareholders either. Furthermore, the entire transaction had been done through banking channels and hence section 68 of the Act was not applicable. Further, where the A.O has accepted the genuineness of shareholder as far as share capital is concerned it could not be held to be a bogus transaction a…

Oracle Granito Ltd., Ahmedabad vs. The Addl. CIT, Range-5, Ahmedabad

ITA 745/AHD/2015[2011-12]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2011-12

Bench: Shri Pramod Kumar & Ms. Madhumita Roy

For Appellant: Shri Aseem Thakkar, A.RFor Respondent: Shri Mudit Nagpal, Sr. D.R
Section 143(2)Section 143(3)Section 2(24)(x)Section 35DSection 35D(2)Section 80I

…off were essentially the ROC charges paid for increasing share capital and the same have been wrongly claimed as revenue expenditure. It is a settled principle of law laid down by the Hon’ble Supreme Court in the matter of Brooke Bond India-vs-CIT reported in 225 ITR 798 (SC) that the expenses for increase in authorized share capital are capital expenses which cannot be allowed as deduction as revenue expenses. Further that, as per Section 35D(2), the nature of expenses eligible for deduction u/s 35D have been specified which do not include expenses for increase in authorized share capital. Relying upon the judgm…

Oracle Granito Ltd., Ahmedabad vs. The ACIT, Circle-5, Ahmedabad

ITA 744/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2010-11

Bench: Shri Pramod Kumar & Ms. Madhumita Roy

For Appellant: Shri Aseem Thakkar, A.RFor Respondent: Shri Mudit Nagpal, Sr. D.R
Section 143(2)Section 143(3)Section 2(24)(x)Section 35DSection 35D(2)Section 80I

…off were essentially the ROC charges paid for increasing share capital and the same have been wrongly claimed as revenue expenditure. It is a settled principle of law laid down by the Hon’ble Supreme Court in the matter of Brooke Bond India-vs-CIT reported in 225 ITR 798 (SC) that the expenses for increase in authorized share capital are capital expenses which cannot be allowed as deduction as revenue expenses. Further that, as per Section 35D(2), the nature of expenses eligible for deduction u/s 35D have been specified which do not include expenses for increase in authorized share capital. Relying upon the judgm…

The Dy. Commissioner of Income Tax, Circle-1(1)(1), Ahmedabad vs. M/S. Applitech Solutions Ltd., Ahmedabad

In the result, appeal filed by the Revenue is dismissed

ITA 2004/AHD/2016[2004-05]Status: DisposedITAT Ahmedabad06 Dec 2018AY 2004-05

Bench: Shri Mahavir Prasad & Shri Waseem Ahmed)

For Appellant: Shri Anil Kshatriya, A.RFor Respondent: Shri Lalit P. Jain, Sr. D.R
Section 143Section 271(1)(c)Section 274

…pertinent to note here that it is settled position of Law that such expenditure is of capital nature and as per provisions of sec.37(1) of the Act is not allowable as expenditure. The Hon'ble Supreme Court in the case of Brooke Bond India Ltd. vs. CIT (1997) 225 ITR 798 has laid down that expenditure incurred for expansion of capital base of the 9 . A.Y. 2004-05 company is capital expenditure. In light of the decision of Hon'ble Supreme Court, there can be no ambiguity or difference of opinion so as to the treatment of such expenditure. The assessee is required to fill in the particular of "amounts debited to P&…