CIT v. Dalmia Cement (Bharat) Ltd.

254 ITR 377High Court2002#174 most cited

What is CIT v. Dalmia Cement (Bharat) Ltd. authority for?

When there is a nexus between an expenditure and the purpose of business, incurred on grounds of commercial expediency, the Revenue cannot question its reasonableness or assume the role of the businessman to compel profit maximization. This principle applies even if the business is not that of the assessee itself.

417

judgments rely on this decision, according to BharatTax’s citation analysis of 367,154 Indian tax judgments — from 2006 to 2026.

Also referred to as

CIT v. Dalmia Cement (Bharat) Ltd. · section 36(1)(iii) · section 37(1) · commercial expediency · business expenditure · nexus with business · Assessing Officer's powers · reasonableness of expenditure · interest free advances · disallowance of interest · SA Builders

Also reported as

183 Taxmann 422

Sections most often in play

Section 36(1)(iii)Section 143(3)Section 40(a)(ia)Section 14ASection 37Section 37(1)Section 35DSection 40A(2)(b)

Issues it is cited on

interest free advancescommercial expediencysection 36(1)(iii)business expediencysection 36(1)section 36disallowance under section 14asection 37section 28revenue expendituresection 40(a)(ia)section 37(1)

Judgments citing CIT v. Dalmia Cement (Bharat) Ltd.

DCIT 10(1), Mumbai vs. Apl Logistics (India) P. Ltd, Mumbai

In the result, appeal of the assessee is partly allowed

ITA 6473/MUM/2013[2008-09]Status: DisposedITAT Mumbai12 Aug 2022AY 2008-09
Section 14ASection 36(1)(iii)Section 37(1)

…curred on grounds of commission expediency. The relevant extract of the observations made by the Hon’ble Apex Court are reproduced herein-below for ready reference: “We agree with the view taken by the Delhi High Court in CIT v. 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 businessman or in the position of the board of directors and assume the role to decide how much is…

DCIT 10(1), Mumbai vs. Apl Logistics (India ) P.Ltd, Mumbai

In the result, appeal of the assessee is partly allowed

ITA 6471/MUM/2013[2007-08]Status: DisposedITAT Mumbai12 Aug 2022AY 2007-08
Section 14ASection 36(1)(iii)Section 37(1)

…curred on grounds of commission expediency. The relevant extract of the observations made by the Hon’ble Apex Court are reproduced herein-below for ready reference: “We agree with the view taken by the Delhi High Court in CIT v. 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 businessman or in the position of the board of directors and assume the role to decide how much is…

Apl Logistics (India) P. Ltd, Mumbai vs. ACIT 10(1), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 4150/MUM/2010[2006-07]Status: DisposedITAT Mumbai12 Aug 2022AY 2006-07
Section 14ASection 36(1)(iii)Section 37(1)

…curred on grounds of commission expediency. The relevant extract of the observations made by the Hon’ble Apex Court are reproduced herein-below for ready reference: “We agree with the view taken by the Delhi High Court in CIT v. 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 businessman or in the position of the board of directors and assume the role to decide how much is…

Allen Career Institute, Kota vs. JCIT, Jaipur

In the result, the Grounds No

ITA 54/JPR/2017[2012-12]Status: DisposedITAT Jaipur04 Aug 2022AY 2012-12
For Appellant: Shri Mahendra Gargieya, Advocate &For Respondent: Shri A.S. Nehra, Addl. CIT
Section 143(3)Section 234ASection 244ASection 36Section 36(1)(iii)Section 37(1)

…while relying on the judgments rendered in (a) S.A. Builders Ltd. V/s CIT (2007) 288 ITR 0001 (SC); (b) Munjal Sales Corporation v/s CIT (2008) 298 ITR 298 (SC) ; (c) CIT V/s Radico Khaitan Ltd. (2005) 274 ITR 354; (d) CIT v/s Dalmia Cement (Pvt.) Ltd. (2002) 254 ITR 377; (e) CIT v/s Britannia Industries Ltd. (2006) 280 ITR 525; and (f) CIT v/s Motors Sales Ltd. (2008) 304 ITR 123 (Allahabad), held as under:- x---------------x----------------x----------------x-------------------x---------x 14. Therefore, the finding reached by the Tribunal is essentially a finding of fact based on the appreciation of the evidence…

Allen Career Institute, Jaipur vs. JCIT, Kota

In the result, the appeal of the assessee is partly allowed

ITA 620/JPR/2016[2011-12]Status: DisposedITAT Jaipur04 Aug 2022AY 2011-12
For Appellant: Shri Mahendra Gargieya, Advocate &For Respondent: Shri A.S. Nehra, Addl. CIT
Section 143(3)Section 36Section 36(1)(iii)Section 37(1)

…king investment in mutual fund/ capital assets. Therefore, the decision in Abhishek Industries in clearly distinguishable on facts as decided in the order by AO. We believe in the view taken by the Delhi High Court in CIT v. Dalmia Cement (Bharat) Ltd. (2002) 254 ITR 377 (Del) 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 armchair of the businessman or in the position of the board of directors and assume the role to decide how muc…

Allen Career Institute, Jaipur vs. JCIT, Kota

In the result, the appeal of the assessee is partly allowed

ITA 246/JPR/2015[2010-11]Status: DisposedITAT Jaipur04 Aug 2022AY 2010-11
For Appellant: Shri Mahendra Gargieya, Advocate &For Respondent: Shri A.S. Nehra, Addl. CIT
Section 143(3)Section 234ASection 244ASection 36(1)(iii)

…while relying on the judgments rendered in (a) S.A. Builders Ltd. V/s CIT (2007) 288 ITR 0001 (SC); (b) Munjal Sales Corporation v/s CIT (2008) 298 ITR 298 (SC) ; (c) CIT V/s Radico Khaitan Ltd. (2005) 274 ITR 354; (d) CIT v/s Dalmia Cement (Pvt.) Ltd. (2002) 254 ITR 377; (e) CIT v/s Britannia Industries Ltd. (2006) 280 ITR 525; and (f) CIT v/s Motors Sales Ltd. (2008) 304 ITR 123 (Allahabad), held as under:- x---------------x----------------x----------------x-------------------x---------x 14. Therefore, the finding reached by the Tribunal is essentially a finding of fact based on the appreciation of the evidence…

DCIT Cent. Cir-4(2), Mumbai vs. M/S. K. Raheja Pvt. Ltd, Mumbai

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

ITA 2218/MUM/2021[2018-19]Status: DisposedITAT Mumbai03 Aug 2022AY 2018-19

Bench: Shri Aby T. Varkey, Jm & Shri Om Prakash Kant, Am आयकर अपील सं/ I.T.A. No.1970/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) K. Raheja Pvt. Ltd. बिधम/ Dcit Central Circle-4(2) Raheja Tower, Plot No. C- Room No.1918, Air India Vs. 30, Oppo. Sidbi, Bandra Building, Nariman Point- Kurla Complex, Bandra (E), 400021. Mumbai-400051. आयकर अपील सं/ I.T.A. No. 2218/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) Dcit Central Circle-4(2) बिधम/ K. Raheja Pvt. Ltd. Room No.1918, Air India Raheja Tower, Plot No. C-30, Vs. Building, Nariman Point- Oppo. Sidbi, Bandra Kurla 400021. Complex, Bandra (E), Mumbai-400051. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaack1949H (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) Assessee By: Shri Vijay Mehta Revenue By: Smt. Neelam Shukla (Dr) सुनवाई की तारीख / Date Of Hearing: 17/06/2022 घोषणा की तारीख /Date Of Pronouncement: 03/08/2022 आदेश / O R D E R Per Aby T. Varkey, Jm: These Are Cross Appeals Preferred By The Assessee & The Revenue Against The Order Of The Ld. Cit(A)-52, Mumbai Dated 08.09.2021 For The A.Y.2018-19. 2. The Grounds Of Appeal Raised By The Assessee Are As Under: -

For Appellant: Shri Vijay MehtaFor Respondent: Smt. Neelam Shukla (DR)
Section 132Section 132(4)Section 139(1)Section 14A

…sits from HRPL, as it was outside the domain and jurisdiction of the Revenue. The reliance placed by the Ld. AR of the assessee on the following decisions is found to be justified. 32. The Hon'ble Delhi High court in the case of CIT vs Dalmia Cement (P) Ltd (254 ITR 377) has observed as under:— "7. It is to be noted that, in the present case, the question that has been raised by the revenue is not one relating to the expenditure being not for the purposes of the business. It is the question of an appropriate amount which would have been paid as commission. In fact, the Assessing Officer himself has allowed to t…

K Raheja Pvt. Ltd, Mumbai vs. DCIT Cent. Cir-4(2), `Mumbai

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

ITA 1970/MUM/2021[2018-19]Status: DisposedITAT Mumbai03 Aug 2022AY 2018-19

Bench: Shri Aby T. Varkey, Jm & Shri Om Prakash Kant, Am आयकर अपील सं/ I.T.A. No.1970/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) K. Raheja Pvt. Ltd. बिधम/ Dcit Central Circle-4(2) Raheja Tower, Plot No. C- Room No.1918, Air India Vs. 30, Oppo. Sidbi, Bandra Building, Nariman Point- Kurla Complex, Bandra (E), 400021. Mumbai-400051. आयकर अपील सं/ I.T.A. No. 2218/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) Dcit Central Circle-4(2) बिधम/ K. Raheja Pvt. Ltd. Room No.1918, Air India Raheja Tower, Plot No. C-30, Vs. Building, Nariman Point- Oppo. Sidbi, Bandra Kurla 400021. Complex, Bandra (E), Mumbai-400051. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaack1949H (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) Assessee By: Shri Vijay Mehta Revenue By: Smt. Neelam Shukla (Dr) सुनवाई की तारीख / Date Of Hearing: 17/06/2022 घोषणा की तारीख /Date Of Pronouncement: 03/08/2022 आदेश / O R D E R Per Aby T. Varkey, Jm: These Are Cross Appeals Preferred By The Assessee & The Revenue Against The Order Of The Ld. Cit(A)-52, Mumbai Dated 08.09.2021 For The A.Y.2018-19. 2. The Grounds Of Appeal Raised By The Assessee Are As Under: -

For Appellant: Shri Vijay MehtaFor Respondent: Smt. Neelam Shukla (DR)
Section 132Section 132(4)Section 139(1)Section 14A

…sits from HRPL, as it was outside the domain and jurisdiction of the Revenue. The reliance placed by the Ld. AR of the assessee on the following decisions is found to be justified. 32. The Hon'ble Delhi High court in the case of CIT vs Dalmia Cement (P) Ltd (254 ITR 377) has observed as under:— "7. It is to be noted that, in the present case, the question that has been raised by the revenue is not one relating to the expenditure being not for the purposes of the business. It is the question of an appropriate amount which would have been paid as commission. In fact, the Assessing Officer himself has allowed to t…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5938/DEL/2019[2017-18]Status: DisposedITAT Delhi02 Aug 2022AY 2017-18

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…nterest is payable, the real test to determine whether the interest is allowable or not is to iudae whether this was done as a measure of commercial expediency or not. 2.10 The apex Court affirmed the decision of the Delhi High Court in CIT Vs. Dalmia Cement: 254 ITR 377, and held that once nexus has been established between the interest paid and the purpose of the business, the Revenue cannot sit in judgment over the reasonableness of the expenditure and the interest paid by the assessee on the borrowed funds advanced to sister I.T.As. No. 5935, 5936, 5937 & 5938/DEL/2019 6 concerns is allowable deduction. 2.1…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5937/DEL/2019[2016-17]Status: DisposedITAT Delhi02 Aug 2022AY 2016-17

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…nterest is payable, the real test to determine whether the interest is allowable or not is to iudae whether this was done as a measure of commercial expediency or not. 2.10 The apex Court affirmed the decision of the Delhi High Court in CIT Vs. Dalmia Cement: 254 ITR 377, and held that once nexus has been established between the interest paid and the purpose of the business, the Revenue cannot sit in judgment over the reasonableness of the expenditure and the interest paid by the assessee on the borrowed funds advanced to sister I.T.As. No. 5935, 5936, 5937 & 5938/DEL/2019 6 concerns is allowable deduction. 2.1…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5936/DEL/2019[2015-16]Status: DisposedITAT Delhi02 Aug 2022AY 2015-16

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…nterest is payable, the real test to determine whether the interest is allowable or not is to iudae whether this was done as a measure of commercial expediency or not. 2.10 The apex Court affirmed the decision of the Delhi High Court in CIT Vs. Dalmia Cement: 254 ITR 377, and held that once nexus has been established between the interest paid and the purpose of the business, the Revenue cannot sit in judgment over the reasonableness of the expenditure and the interest paid by the assessee on the borrowed funds advanced to sister I.T.As. No. 5935, 5936, 5937 & 5938/DEL/2019 6 concerns is allowable deduction. 2.1…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5935/DEL/2019[2014-15]Status: DisposedITAT Delhi02 Aug 2022AY 2014-15

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…nterest is payable, the real test to determine whether the interest is allowable or not is to iudae whether this was done as a measure of commercial expediency or not. 2.10 The apex Court affirmed the decision of the Delhi High Court in CIT Vs. Dalmia Cement: 254 ITR 377, and held that once nexus has been established between the interest paid and the purpose of the business, the Revenue cannot sit in judgment over the reasonableness of the expenditure and the interest paid by the assessee on the borrowed funds advanced to sister I.T.As. No. 5935, 5936, 5937 & 5938/DEL/2019 6 concerns is allowable deduction. 2.1…

Jurasic Refiners & Jewels Pvt. Ltd. (Formerly Jurassic Finance & Consultants Pvt. Ltd.), Delhi vs. Addl. CIT, Special Range- 5, New Delhi

In the result, the appeal of the assessee is dismissed

ITA 256/DEL/2019[2014-15]Status: DisposedITAT Delhi27 Jul 2022AY 2014-15
Section 143(3)Section 36Section 37(1)Section 73

…ssion" used in section 36(l)(iii). This decision overruled the Bombay High Court decisions in the case of Phaltan Sugar Works Ltd. Reported in 208 ITR 989 and 215 ITR 582, and approved the Delhi High Court decision in CIT v. Dalmia Cement (Bharat) Ltd. [2002] 254 ITR 377. Subsequent to this decision of the Apex Court, the Dept. filed an SLP against the Delhi High Court's decision in Addl. CIT vs Tulips Star Hotels Ltd. reported in 338 ITR 482 wherein the High Court had held that the interest liability on loans borrowed to acquire the equity capital of a subsidiary company which was in the same line of business wa…

M/s Nitesh Estates Private Limited vs. Deputy Commissioner of Income Tax

ITA/31/2015HC Karnataka22 Jul 2022

Bench: P.S.DINESH KUMAR,ANANT RAMANATH HEGDE

Section 260Section 37(1)

…tances of the case. No businessman can be compelled to maximise its profit. The tax authorities must not look at the matter from their viewpoint but that of a prudent businessman. 8 (2002)254 ITR 377 I.T.A No.31/2015 14 18. Thus, what is required to be examined is, whether there was nexus between the compensation paid to Shri. Mahesh Bhoopathi and the construction agreement. The answer must…

ACIT 28 (2), Mumbai vs. Real Trade Technologies, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 6939/MUM/2019[2013-14]Status: DisposedITAT Mumbai07 Jul 2022AY 2013-14

Bench: Shri Pavan Kumar Gadale & Shri Gagan Goyalacit-28(2), Room No. 307, 3Rd Floor,Tower No.6, Vashi Railway Station Complex, Vashi, Navi Mumbai-400703 ...... Appellant Vs. M/S Real Trade Technologies, F-07, D-02, Real Tech Park, Plot No.-39/02, Sector-10, Vashi, Navi Mumbai-400705. Pan: Aaifr4687C ..... Respondent Appellant By : Sh. T. Shankar (Sr. Ar.Cit) Respondent By : Sh. M. Subramanian (Ar) Date Of Hearing : 12/04/2022 Date Of Pronouncement : 07/07/2022 Order Per Gagan Goyal, A.M: This Appeal By The Revenue Is Directed Against The Order Of Ld. Commissioner Of Income Tax (Appeals)-26, Mumbai [Hereinafter Referred To As ‘The Cit (A)’] Dated 26.08.2019 For The Assessment Year (Ay) 2013-14. The Revenue Has Raised The Following Grounds Of Appeal: "1. Whether On The Facts & In The Circumstances Of The Case & In Law, The Ld. Citia) Was Correct In Deleting The Disallowance Of Proportionate Interest Paid On Borrowed Capital Amounting To Rs. 2, 12 40,434/- U/S 36(1) (Iii) Of The Act Without Appreciating That The Assessee Has Not Been Able To Establish The Commercial

For Appellant: Sh. T. Shankar (Sr. Ar.CIT)For Respondent: Sh. M. Subramanian (AR)
Section 143(2)Section 36(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D”, MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER ACIT-28(2), Room No. 307, 3rd Floor,Tower No.6, Vashi Railway Station Complex, Vashi, Navi Mumbai-400703 ...... Appellant Vs. M/s Real Trade Technologies, F-07, D-02, Real Tech Park, Plot No.-39/02, Sector-10, Vashi, Navi Mumbai-400705. PAN: AAIFR4687C ..... Respondent Appellant by : Sh. T. Shankar (Sr. Ar.CIT) Respondent by : Sh. M. Subramanian (AR) Date of hearing : 12/04/2022 Date of pronouncement : 07/07/2022 ORDER PER GAGAN GOYAL, A.M: This appeal by the Reve…

Kothari Sugars and Chemicals Ltd, Chennai vs. JCIT, Company Range II, Chennai

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

ITA 204/CHNY/2019[2011-12]Status: DisposedITAT Chennai06 Jul 2022AY 2011-12

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwal

For Appellant: Shri Vikram Vijayaraghavan, AdvocateFor Respondent: Shri D. Hema Bhupal, JCIT
Section 143(3)

…bay High Court in Phaltan Sugar Works Ltd. vs. Commissioner of Wealth-Tax (1995) 215 ITR 582 also does not appear to be correct. 31. We agree with the view taken by the Delhi High Court in CIT vs. Dalmia Cement (Bharat) Ltd. (2002) 172 CTR (Del) 188 : (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 businessman or in the position of the board of directors and assume the role to decide how much is…

Lodha Developers Ltd(Formerly Known As Lodha Developers Private Limited), Mumbai vs. DCIT Cen Cir 7(3), Mumbai

In the result, appeal filed by the revenue is dismissed

ITA 2349/MUM/2018[2014-15]Status: DisposedITAT Mumbai12 May 2022AY 2014-15

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Pavan Kumar Gadale, Hon'Blemacrotech Developers Limited V. Dcit – Central Circle – 7(3) {Erstwhile Lodha Developers Limited} Room No. 655, 6Th Floor 412, 4Th Floor, 17G Vardhaman Chamber Aayakar Bhavan, M.K. Road Cawasji Patel Road, Horniman Circle Mumbai – 400020 Fort, Mumbai - 400001 Pan: Aaacl1490J (Appellant) (Respondent) Dcit – Central Circle – 7(3) V. Macrotech Developers Limited Room No. 655, 6Th Floor {Erstwhile Lodha Developers Limited} 412, 4Th Floor, 17G Vardhaman Chamber Aayakar Bhavan, M.K. Road Cawasji Patel Road, Horniman Circle Mumbai – 400020 Fort, Mumbai - 400001 Pan: Aaacl1490J (Appellant) (Respondent)

For Appellant: Shri Rajan Vora &For Respondent: Shri Sandeep Raj
Section 37(1)

…o Cycles (P) Ltd [SC] [2015] 379 ITR 347 (iii). CIT vs. Reliance Communications Infrastructure Lts. [Bom HC] [2012] 254 CTR 251 6 ITA NO. 2349 & 2148/MUM/2018 (A.Y. 2014-15) Macrotech Developers Limited (iv). CIT vs. Daimia Cement Bharat Ltd. [Del HC} [2011] 330 ITR 595 d) Without prejudice to the above submissions, the assessee would also like to submit that the AO for the AY 2015-16 has allowed loss of Rs. 37.72 crores on basis that the loss is actually realised, hence if the loss of Rs. 13.71 crores not allowable then the entire loss of Rs. 52.43 crores should be allowed as deduction and the Id. AO should be…

Rushabhdev Infra Project Pvt. Ltd., Ahmedabad vs. The Pr. CIT -3, Ahmedabad

The appeal of the assessee is allowed

ITA 275/AHD/2020[2015-16]Status: DisposedITAT Ahmedabad29 Apr 2022AY 2015-16
For Appellant: Shri Hem Chhajed, A.RFor Respondent: Shri Samir Tekriwal, CIT/DR
Section 143(3)Section 263Section 40A(2)(b)

…ve been stated by the assessee including Motilal C Patel - 176 ITR 666 (Guj.), Shivalik Buildwell Pvt Ltd - 2)13 - 40 Taxman.com 219 (Guj), Ashaland Corporation - 133 ITR 55 (Guj), Madhav Prasad Jatia v. CIT - (1979 ) 118 ITR 200, Dalmia Cement (B) Ltd (2002) 254 ITR 377 but they are all for periods prior to 2012 and hence they cannot be applied to the present case since accounting guidelines have been amended and are mandatory. iii) Regarding the deductibility of interest on borrowed funds, the Assessing Officer has not conducted any enquiry whether it is part of project cost or allowable separately as deduction…

M/S Continental Automotive Components India Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-2(1)(1), Bangalore

In the result, the appeal is partly allowed

ITA 129/BANG/2019[2014-15]Status: DisposedITAT Bangalore29 Mar 2022AY 2014-15

Bench: Shri N.V. Vasudevan & Shri B. R. Baskaranassessment Year :2014-15 M/S. Continental Automotive Vs. Dcit, Components India Pvt. Ltd., Circle – 2(1)(1), Plot No.53B, Bommasandra Industrial Bengaluru. Area, Hosur Road, Attibele Hobli, Anekal Taluk, Bengaluru–560 099. Pan : Aakcs 9578 C Appellant Respondent Assessee By : Shri. T. Suryanarayana, Senior Advocate Revenue By : Shri. Mudavathu Harish Chandra Naik, Cit(Dr)(Itat), Bengaluru. Date Of Hearing : 21.03.2022 Date Of Pronouncement : 29.03.2022 O R D E R

For Appellant: Shri. T. Suryanarayana, Senior AdvocateFor Respondent: Shri. Mudavathu Harish Chandra Naik, CIT(DR)(ITAT), Bengaluru
Section 143(3)Section 92

…of [2015] 41 the expense, the learned ITR(T) 733 AO cannot question (Delhi - Trib.) commercial expediency of a transaction.  CIT vs. Further, entering into Dalmia agreements for use of Cement (P.) intellectual property of Ltd. [2002] the group companies has 254 ITR 377 benefited the Assessee. (Delhi) – this was affirmed by the Hon’ble Supreme Court [2007] 288 ITR 1 (SC) Sundry creditors This is a mere remark - 5 are increasing made by the learned AO Continental Automotive Components India Pvt.Ltd. Page 93 of 97 without any basis/ conclusion towards the same. However, the Assessee submits that sundry creditors a…

M.Palanisamy, Coimbatore vs. ACIT Non Corporate Circle 2, Coimbatore

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

ITA 1642/CHNY/2017[2011-12]Status: DisposedITAT Chennai28 Feb 2022AY 2011-12

Bench: Shri V. Durga Rao & Shri G. Manjunatha

For Appellant: 04.01.2022For Respondent: Mr. S.Sridhar, Advocate
Section 40A(2)(a)

…dependent parties cannot be dictated by the AO. It has been held by Hon’ble Supreme Court in the case of S.A. Builders Ltd., Vs. CIT [2007] 288 ITR 1 as below: “We agree with the view taken by the Delhi High Court in CIT V. Dalmia Cement (Bharat) 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 businessman or in the position of the board of directors and assume the role to decide how much is…