CIT v. Dalmia Cement (Bharat) Ltd.

Pr. Commissioner of Income Tax-1, Delhi vs. M/S Advantage Fashion Pvt. Ltd

Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE DR. JUSTICE SWARANA KANTA SHARMA

…mize his profit. The A.O. cannot put himself in the shoes of the assessee and see how a prudent businessman would act. The authorities must not look at the matter from their own viewpoint but that of a prudent businessman CIT v. Dalmia Cement (B.) Ltd. [2002] 254 ITR 377(De1). Given the long-standing business relationship between the parties, there could be any commercial expediency (including an inability of the appellant to sell the plots to an outside party at the price of Rs.9,250/- p. sq.yd. at that point of time, or any other market condition) for the appellant agreeing to not insist on the higher rate agre…

Pr. Commissioner of Income Tax-1, Delhi vs. M/S Advantage Fashion Pvt. Ltd

…mize his profit. The A.O. cannot put himself in the shoes of the assessee and see how a prudent businessman would act. The authorities must not look at the matter from their own viewpoint but that of a prudent businessman CIT v. Dalmia Cement (B.) Ltd. [2002] 254 ITR 377(De1). Given the long-standing business relationship between the parties, there could be any commercial expediency (including an inability of the appellant to sell the plots to an outside party at the price of Rs.9,250/- p. sq.yd. at that point of time, or any other market condition) for the appellant agreeing to not insist on the higher rate agre…

DCIT, Central Circle-14, Delhi vs. Iris Computers Ltd., New Delhi

In the result, the appeal of revenue is dismissed

Bench: Sh. S. Rifaur Rahman & Sh. Sudhir Kumarassessment Year: 2013-14 Dcit Central Circle -14 Vs. M/S. Iris Computers Ltd. Delhi E-69, Vasant Marg, Vasant Vihar, New Delhi-110057 Pan No.Aaaci9670H (Appellant) (Respondent) Appellant By Ms. Anu Krishna Aggarwal, Cit Dr Respondent By Sh. Ved Jain, Ar Ms. Supriya Mehta, Ar Date Of Hearing: 15/07/2024 Date Of Pronouncement: 31/07/2024 Order Per Sudhir Kumar, Jm: This Appeal By The Revenue Is Directed Against The Order Of The Commissioner Of Income Tax (Appeals)-26, New Delhi [Hereinafter Referred To As “Cit(A)”] Vide Order Dated 17.04.2023 Pertaining To A.Y. 2013-14 & Arises Out Of The Assessment Order Dated 31.03.2016 Under Section 143(3) Of The Income Tax Act 1961 [Hereinafter Referred As ‘The Act’]. 2. Aggrieved By The Order Of The Lower Authorities, The Revenue Is In Appeal Before Us By Raising The Following Grounds:-

…e expenditure for the business purposes. In the case of SA Builders Ltd vs Commissioner of Income Tax 2006(12) TMI 82 the Hon'ble Supreme court held as under :- “35.We agree with the view taken by the Delhi High Court in CIT Vs. Dalmia Cement (B.) Ltd. [2002] 254 ITR 377 that once it is established that there was nexus between the expenditure and the purpose of the business (which need not necessarily be the business of the assessee itself), the Revenue cannot justifiably claim to put itself in the arm-chair of the business man or in the position of the board of directors and assume the role to decide how much is…

Sh Tech Park Developers Pvt. Ltd., Gurgaon vs. ACIT, Circle-22(2), New Delhi

In the result, grounds raised by the assessee are allowed for

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

…d of accounting thereafter or that he has in fact adopted it thereafter, that satisfies the requirement of section 145 of the Act. The aforesaid submission is supported by judicial pronouncements as are stated as below: (i) Indo-Commercial Bank Ltd. vs. CIT, 44 ITR 22 (Mad.) (ii) Forest Industries Travancore Ltd. vs. CIT, 51 ITR 329 (Ker.) (iii) New Victoria Mills Co. Ltd. vs. CIT, 61 ITR 395 (All.) (iv) Dr. Ishwari Prasad vs. CIT, 143 ITR 789 (All.) (v) CIT vs. Shriram Associated Bearing Pvt. Ltd. SLP (Civil) No. 6665 of 1982, 150 ITR (St.) 77 (SC) (vi) CIT vs. Hind Lamps Ltd., (1987) Taxation 85(3)-225 (All.)…

Sukhma Sons & Associates, New Delhi vs. JCIT, Range- 63, New Delhi

Bench: due date as per Haryana Labour Welfare Act.

…d as interest-free loans to its sister concerns. What is relevant here is whether such loans/advances given by the assessee/appellant to the sister concernsis for commercial expediency. Page 7 of 12 The Hon’ble Delhi High Court in Dalmia Cement (Bharat) Ltd. 254 ITR 377 has held that once it is established that there is nexus between the expenditure and the purpose of the business, the interest expenses have to be allowed. Here, we have to see the transfer of the borrowed funds to a sister concern from the point of view of commercial expediency and not from the point of view whether the amount was advanced for e…

ACIT, Circle-7(1), Delhi vs. Dish Infra Services Pvt. Ltd., Noida

In the result, the appeal of the Revenue is dismissed

Bench: Dr. B. R. R. Kumarms. Astha Chandra

…made out of interest-free funds available and not out of borrowed funds. Further, the reliance placed by the ld. CIT(A) 7 Dish Infra Services Pvt. Ltd. on the judgment of Hon’ble jurisdictional High Court in case of CIT vs. Dalmia Cement (Bharat) Ltd. [2002] 254 ITR 377 wherein it was held that once it is established that there was nexus between the expenditure and the purpose of the business, no disallowance on account of interest is called for, is squarely applicable to the facts of the case. Hence, we decline to interfere with the order of the ld. CIT(A) on this ground. 8. In the result, the appeal of the Re…

Crm Services India Private Limited, New Delhi vs. DCIT, Circle-4(2), New Delhi

The appeals of the assessee are allowed with consequential effect

Bench: Shri Shamim Yahya & Shri Anubhav Sharma

…ventures Ltd: 331 ITR 502 (Del) - CIT vs. Padmani Packaging (P) Ltd. : 155 Taxmann 268 (Del) - CIT v. Rockman Cycle Industries Ltd.: 331 ITR 401 (P&H) (FB) - CIT vs. EKL Appliances Ltd. : ITA No. 1068/2011 & 1070/2011 (Del HC) - CIT v. Dalmia Cement (P.) Ltd: 254 ITR 377 (Del) 18. Ld. Sr. Counsel, refered to the Hon’ble Supreme Court judgment in the case of Vodafone International Holdings B.V. vs. Union of India &Anr., 341 ITR 1, wherein, the apex Court after considering the jurisprudence that has developed in India and England over the years, on the issue of tax avoidance and tax evasion, permissible and imperm…

Crm Services India Private Limited, New Delhi vs. DCIT, Circle-4(2), New Delhi

The appeals of the assessee are allowed with consequential effect

Bench: Shri Shamim Yahya & Shri Anubhav Sharma

…ventures Ltd: 331 ITR 502 (Del) - CIT vs. Padmani Packaging (P) Ltd. : 155 Taxmann 268 (Del) - CIT v. Rockman Cycle Industries Ltd.: 331 ITR 401 (P&H) (FB) - CIT vs. EKL Appliances Ltd. : ITA No. 1068/2011 & 1070/2011 (Del HC) - CIT v. Dalmia Cement (P.) Ltd: 254 ITR 377 (Del) 18. Ld. Sr. Counsel, refered to the Hon’ble Supreme Court judgment in the case of Vodafone International Holdings B.V. vs. Union of India &Anr., 341 ITR 1, wherein, the apex Court after considering the jurisprudence that has developed in India and England over the years, on the issue of tax avoidance and tax evasion, permissible and imperm…

Kuroda Electric India Private Limited, Haryana vs. ACIT, Circle 2(1), Gurgaon

In the result, the Appeal filed by the assessee is allowed

Bench: Shamim Yahya & Sh. Yogesh Kumar U.S.Ita No. 3123/Del/2023, A.Y. 2016-17 Kuroda Electric India Vs. Acit, Private Ltd. Circle -2(1), Unit No. 511, Gurgaon Suneity Business Tower, Sector-54, Golf Course, Road Gurgaon, Chakkarpur B.O., Gurgaon Haryana, India 122002 Pan : Aafck9587N Appellant Respondent

…nces, the Ld. A.O. has been totally wrong in considering the fact that the discharge of the burden has to be effective and meaningful and not to cover up merely by book entries and paper work. 13. The Jurisdictional High court in the case of Dalmia Cement (254 ITR 377), held as under:- “ Under Section 37(1) of the Income tax Act, 1961, the jurisdiction of the Revenue is confined to deciding the reality of the business expenditure, viz., whether the amount claimed as a deduction was factually expended or laid out and whether it was wholly and exclusively for the purpose of the business. It must not, however, s…

ACIT, Circle- 19(1), New Delhi vs. Ojas Industries (P) Ltd., New Delhi

In the result, the appeal of the assessee is allowed and the appeal of the Revenue is dismissed

Bench: Dr. B. R. R. Kumarshri Yogesh Kumar Us

…work in progress, more so when the assessee is having mixed funds. The ld. CIT(A) relied the Hon'ble apex Court in the case of SA Builder vs. CIT, 288 ITR 1 has endorsed the view taken by the Hon'ble Delhi High Court in the case of CIT vs. Dalmia Cement Ltd., 254 ITR 377 for the proposition that no businessman need be compelled to maximize his profit. 26. In view of these facts and the provisions of Section 36(1)(ii), we concur with the order of the ld. CIT(A) that there is no basis for impugned disallowance. Disallowance of Rs. 25 crore-: 27. The entire background of the issue is as under: “The AO has made an…

M/S. Ojas Industries (P) Ltd., New Delhi vs. DCIT, New Delhi

In the result, the appeal of the assessee is allowed and the appeal of the Revenue is dismissed

Bench: Dr. B. R. R. Kumarshri Yogesh Kumar Us

…work in progress, more so when the assessee is having mixed funds. The ld. CIT(A) relied the Hon'ble apex Court in the case of SA Builder vs. CIT, 288 ITR 1 has endorsed the view taken by the Hon'ble Delhi High Court in the case of CIT vs. Dalmia Cement Ltd., 254 ITR 377 for the proposition that no businessman need be compelled to maximize his profit. 26. In view of these facts and the provisions of Section 36(1)(ii), we concur with the order of the ld. CIT(A) that there is no basis for impugned disallowance. Disallowance of Rs. 25 crore-: 27. The entire background of the issue is as under: “The AO has made an…