Chainrup Sampatram v. CIT

Purna Purshottam Exports, Mumbai vs. ACIT Central Circle, 2(2), Mumbai

In the result, the appeal of the assessee for assessment year

Bench: Shri Om Prakash Kant () & Shri Sandeep Singh Karhail () Assessment Year: 2007-08 Purna Pushottam Exports, Ito-32(3)(5), Gala No. 329, Vardhman Mumbai. Vs. Industrial Estate, Behind Petrol Pump, S.V. Road, Dahisar East, Mumbai-400068. Pan No. Aaefp 8085 E Appellant Respondent Assessment Year: 2018-19 Purna Pushottam Exports, Acit Central Circle, 2(2), Gala No. 329, Vardhman Mumbai. Vs. Industrial Estate, Behind Petrol Pump, S.V. Road, Dahisar East, Mumbai-400068. Pan No. Aaefp 8085 E Appellant Respondent

…ssee section 115BBE is not justified. The Ld. Counsel of the ass section 115BBE is not justified. The Ld. Counsel of the ass relied on the decision in the case of Shainrup Sampatram v. CIT Shainrup Sampatram v. CIT relied on the decision in the case of [1953] 24 ITR 481 (SC) [1953] 24 ITR 481 (SC) and in the case of Stone Age (P.) Ltd. v. Stone Age (P.) Ltd. v. DCIT [2020] 116 taxmann.com 930 (Jaipur DCIT [2020] 116 taxmann.com 930 (Jaipur-Trib.). . 1616 & 1618/M/2023 14 Purna Pushottam Exports 6.3.1 The Ld. Counsel of the assessee also referred to page 107 The Ld. Counsel of the assessee also referred to page…

Purna Purshottam Exports, Mumbai vs. Income Tax Officer 32(2)(5), Mumbai

In the result, the appeal of the assessee for assessment year

Bench: Shri Om Prakash Kant () & Shri Sandeep Singh Karhail () Assessment Year: 2007-08 Purna Pushottam Exports, Ito-32(3)(5), Gala No. 329, Vardhman Mumbai. Vs. Industrial Estate, Behind Petrol Pump, S.V. Road, Dahisar East, Mumbai-400068. Pan No. Aaefp 8085 E Appellant Respondent Assessment Year: 2018-19 Purna Pushottam Exports, Acit Central Circle, 2(2), Gala No. 329, Vardhman Mumbai. Vs. Industrial Estate, Behind Petrol Pump, S.V. Road, Dahisar East, Mumbai-400068. Pan No. Aaefp 8085 E Appellant Respondent

…ssee section 115BBE is not justified. The Ld. Counsel of the ass section 115BBE is not justified. The Ld. Counsel of the ass relied on the decision in the case of Shainrup Sampatram v. CIT Shainrup Sampatram v. CIT relied on the decision in the case of [1953] 24 ITR 481 (SC) [1953] 24 ITR 481 (SC) and in the case of Stone Age (P.) Ltd. v. Stone Age (P.) Ltd. v. DCIT [2020] 116 taxmann.com 930 (Jaipur DCIT [2020] 116 taxmann.com 930 (Jaipur-Trib.). . 1616 & 1618/M/2023 14 Purna Pushottam Exports 6.3.1 The Ld. Counsel of the assessee also referred to page 107 The Ld. Counsel of the assessee also referred to page…

Asst CIT Cir 2(2)(1), Mumbai vs. State Bank of India, Mumbai

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

Bench: Shri B.R. Baskaran & Shri Sandeep Singh Karhail

…s contended by the assessee that it is a well settled principle of law that unrealised gains on stock are not to be brought to the tax net. Reliance in this regard is placed on the decision of the Supreme Court in the case of Chainrup Sampatram vs. CIT [1953] 24 ITR 481 (SC), wherein it is held that profit cannot “arise out of the valuation of the closing stock”. The relevant extract of the judgement of the Supreme Court is reproduced below: “While we agree with the conclusion that no part of the profits of the firm in the accounting year can be said to have accrued or arisen at Bikaner, the reasoning by which th…

State Bank of India, Mumbai vs. Addl CIT RG 2(2), Mumbai

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

Bench: Shri B.R. Baskaran & Shri Sandeep Singh Karhail

…s contended by the assessee that it is a well settled principle of law that unrealised gains on stock are not to be brought to the tax net. Reliance in this regard is placed on the decision of the Supreme Court in the case of Chainrup Sampatram vs. CIT [1953] 24 ITR 481 (SC), wherein it is held that profit cannot “arise out of the valuation of the closing stock”. The relevant extract of the judgement of the Supreme Court is reproduced below: “While we agree with the conclusion that no part of the profits of the firm in the accounting year can be said to have accrued or arisen at Bikaner, the reasoning by which th…

ACIT-Circle-14(1)(1), Mumbai vs. M/S Lichen Metals Pvt Ltd, Mumbai

In the result, the appeal of the revenue stands dismissed

Bench: Shri Aby T. Varkey, Jm & Shri Amarjit Singh, Am आयकर अपील सं/ I.T.A. No.2766/Mum/2022 (निर्धारण वर्ा / Assessment Years: 2014-15) Acit, Circle-14(1)(1) बिधम/ M/S. Lichen Metals Pvt. Room No. 432, 4Th Floor, Ltd. Vs. Aayakar Bhavan, M. K. Edelweiss House, Off C. Road, Mumbai-400020. S. T Road, Kalna, Santacruz (E), Mumbai- 400098. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No. : Aabcl4440P (अपीलार्थी /Appellant) .. (प्रत्यर्थी / Respondent) Assessee By: Shri Ravikant Pathak Revenue By: Smt. Kavita Kaushik (Sr. Ar) सुनवाई की तारीख / Date Of Hearing: 06/02/2023 घोषणा की तारीख /Date Of Pronouncement: 10/02/2023 आदेश / O R D E R Per Aby T. Varkey, Jm: This Is An Appeal Preferred By The Revenue Against The Order Of The Ld. Cit(A)/Nfac, Delhi, Dated 05.09.2022 For The Ay. 2014-15. 2. The Main Issue That Has Been Raised By The Revenue Is Against The Action Of The Ld. Cit(A) Deleting The Addition Made By The Ao Of Rs.2,06,68,983/- On Account Of Mark To Market Loss On Trading Of Derivative By Treating It As Notional Loss.

…made out by the Revenue that the valuation done is not correct or not properly explained. In these situations, the decisions of the Hon’ble Apex Court relied upon hereinabove in the case of Chainrup Sampatram vs. Commissioner of Income Tax, West Bengal (1953) 24 ITR 481 (SC), is quite germane. Furthermore, we find the Assessing Officer has totally erred in placing reliance upon the decision of the Hon’ble Apex Court in the case of M/S. Sanjeev Woolen Mills vs Commissioner Of Income-Tax (in Civil Appeal No. 6735- 6736/2003 vide order dated 24.11.2005). In the said decision, the Hon’ble Apex Court has analyzed the…

DCIT 3(3)(1), Mumbai vs. Satya Securities Ltd, Mumbai

In the result, the present appeal is partly allowed

…IN THE INCOME TAX APPELLATE TRIBUNAL "G" BENCH, MUMBAI SHRI B.R. BASKARAN, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER Deputy Commissioner of Income Tax, Room No. 609, 6th Floor, Aayakar Bhavan, M.K. Road, Mumbai - 400020 ……………… Appellant M/s Satya Securities Ltd., Vs 1009, Maker Chamber-V, 10th Floor, Nariman Point, Mumbai - 400021 …………. Respondent [PAN: AAECS9414M] Appearances For the Appellant/Department : Shri A.K. Das For the Respondent/Assessee : Shri A.K. Tibrewal & Saurabh Gupta Date of conclusion of hearing : 15.11.2022 Date of pronouncement of order : 31.01.2023 O R D E R Per Rahul Chaudhar…

ITO-33(1)(2), Mumbai vs. Shri Vikram Baijnath Agarwal, Mumbai

In the result, appeal filed by the revenue is partly allowed and cross objection filed by the assessee is dismissed

Bench: Shri Vikas Awasthy, Hon'Ble & Shri S. Rifaur Rahman, Hon'Bleincome Tax Officer – 33(1)(2) V. Shri Vikrambaijnath Agarwal Room No. 945, 9Th Floor 2003/04, Birchwood Raheja Villows Kautilya Bhavan, Bandra Kurla Complex Lokhandwala Township Nr Mahindra Gate 4 Kandivali (E), Mumbai - 400101 Bandra(E), Mumbai - 400051 Pan: Adepa8582C Appellant Respondent

…od of accounting regularly employed may be discarded only if, in the opinion of the taxing authorities, income of the trade cannot be properly deduced therefrom. Valuation of stock at cost is one of the recognized methods. 27. ChainrupSampatram vs. CIT (1953) 24 ITR 481 (SC) (para 10) - It is a misconception to think that any profit "arises out of the valuation of the closing stock" and the situs of its arising or accrual is where the valuation is made. As already stated, valuation of unsold stock at the close of an accounting period is a necessary part of the process of determining the trading results of that pe…

Edelweiss Commodities Services Ltd, Mumbai vs. DCIT, CC-1(1), Mumbai

In the result, the appeal filed by the assessee is treated as allowed

…t or market price whichever is the lower, and it is now generally accepted as an established rule of commercial practice and accountancy". This is what the Supreme Court held in the case of Chainrup Sampatram vs. Commissioner of Income Tax, West Bengal (1953) 24 ITR 481 (SC), speaking through Hon'ble Justice Patanjali Sastri, the then Chief Justice of India (page 485- 486 of the Report). At page 486 the Supreme Court further observed that "loss due to a fall in price below cost is allowed even if such loss has not been actually realized". Quoting from the case of Whimster & Co. vs. Commissioners of Inland Revenue…

DCIT-9(1)(2), Mumbai vs. Ascent Hydro Projects Pvt. Ltd., Mumbai

In the result, appeals filed by the revenue are dismissed

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Amarjit Singh, Hon'Ble

…in the shape of unrealized gains should not be brought into the accounts as no prudent trader would care to show increased profit before its realization. This is what the Supreme Court has held in the case of Chainrup Sampatram V/ s. CIT, West Bengal (1953) (24 ITR 481) (SC). The Hon‘ble Apex Court’s decision is in keeping with the guidelines laid down by the ‘Institute of Chartered Accountant of India which has approved the rule of prudence for not recognizing the anticipated profit before the same is realized. The said decision had been followed in the case of Edelweiss Security Limited V/s Additional CIT (ITA…

Pr. CIT 9, Mumbai vs. Ascent Hydro Projects Pvt. Ltd., Mumbai

In the result, appeals filed by the revenue are dismissed

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Amarjit Singh, Hon'Ble

…in the shape of unrealized gains should not be brought into the accounts as no prudent trader would care to show increased profit before its realization. This is what the Supreme Court has held in the case of Chainrup Sampatram V/ s. CIT, West Bengal (1953) (24 ITR 481) (SC). The Hon‘ble Apex Court’s decision is in keeping with the guidelines laid down by the ‘Institute of Chartered Accountant of India which has approved the rule of prudence for not recognizing the anticipated profit before the same is realized. The said decision had been followed in the case of Edelweiss Security Limited V/s Additional CIT (ITA…

DCIT 2(2), Mumbai vs. State Bank of India, Mumbai

Bench: Shri M. Balaganesh & Shri Kuldip Singhassessment Year: 2005-06 M/S. State Bank Of India, Dcit, Financial Reporting & Circle -2(2), Taxation Dept., Mumbai 3Rd Floor, Vs. Corporate Centre, Madam Cama Road, Nariman Point, Mumbai – 400 021 Pan: Aaacs8577K (Appellant) (Respondent) Assessment Year: 2005-06 Office Of The Dcit-2(2), M/S. State Bank Of India, R.No.545, Central Office, Aayakar Bhavan, Accounts & Compliance M.K. Road, Dept., Vs. 14Th Floor, Mumbai- 400 020 Madam Cama Rd., Nariman Point, Mumbai – 400 021 Pan: Aaacs8577K (Appellant) (Respondent)

…s contended by the assessee that it is a well settled principle of law that unrealised gains on stock are not to be brought to the tax net. Reliance in this regard is placed on the decision of the Supreme Court in the case of Chainrup Sampatram vs. CIT [1953] 24 ITR 481 (SC), wherein it is held that profit cannot "arise out of the valuation of the closing stock". The relevant extract of the judgement of the Supreme Court is reproduced below: “While we agree with the conclusion that no part of the profits of the firm in the accounting year can be said to have accrued or arisen at Bikaner, the reasoning by which t…