CIT v. Dhanrajgirji Raja Narasingirji

91 ITR 544Supreme Court of India1973#643 most cited

What is CIT v. Dhanrajgirji Raja Narasingirji authority for?

The revenue cannot question the commercial expediency or wisdom of an expenditure incurred by a businessman, as the businessman is the best judge of their own business interests. The department's role is limited to verifying if the expenditure was genuinely incurred and was wholly and exclusively for business purposes.

154

judgments rely on this decision, according to BharatTax’s citation analysis of 367,368 Indian tax judgments — from 2009 to 2026.

Also referred to as

CIT v. Dhanrajgirji Raja Narasingirji · 91 ITR 544 · Section 37(1) · commercial expediency · business expediency · revenue dictating business affairs · expenditure wholly and exclusively for business · allowability of business expenditure · genuineness of expenditure · Section 40A(2)(b) · Income-tax Act 1961

Sections most often in play

Section 37(1)Section 143(3)Section 1961Section 195Section 40A(2)(b)Section 68Section 14ASection 36(1)(iii)

Issues it is cited on

section 5(2)(b)section 10(2)(xv)section 5(2)section 40a(2)(b)section 40a(2)section 41(1)commercial expediencybusiness expediencysundry creditorssection 41section 40asection 145(3)

Judgments citing CIT v. Dhanrajgirji Raja Narasingirji

Woodward India Pvt. Ltd., Gurgaon vs. DCIT, New Delhi

The appeal of the assessee stands partly allowed

ITA 916/DEL/2015[2009-10]Status: DisposedITAT Delhi25 Mar 2019AY 2009-10

Bench: Shri N.K. Billaiya & Shri Sudhanshu Srivastavaassessment Year: 2009-10 Woodward India Pvt. Ltd., Dcit, (Formerly Known As Woodward Circle-18(1), Governor India Ltd.,), 12Th Floor, New Delhi. Vs Building No. 5, Dlf Cyber Terraces, Dlf Cyber City, Phase-Iii, Gurgaon-122002 Appellant Respondent Assessee By : Shri Vishal Kalra, Adv. Shri S.S. Tomer, Adv. Department By: Shri H.K. Choudary, C.I.T. Dr Date Of Hearing: 17.01.2019 Date Of Pronouncement: 25.03.2019

For Appellant: Shri Vishal Kalra, AdvFor Respondent: Shri H.K. Choudary, C.I.T. DR
Section 92Section 92C

…urport to place themselves in the shoes of a business person and assume a role to decide whether a particular expenditure needs to be incurred or not. Reliance in this regard was placed on the following decisions: • CIT vs. Dhanrajgirji Raja Narasingir (1973) 91 ITR 544 (SC) • CIT vs. Walchand and Co (P) Ltd. (65 ITR 381)(SC) • CIT vs. Dalmia Cement Ltd (254 ITR 377)(Del) • S.A. Builders Ltd. vs. CIT and Anr. (289 ITR 26)(SC) • EKL Appliances Limited vs. CIT [2012] 345 ITR 241 (Del) 17 | P a g e 3.20 Lastly, the Ld AR drew our attention to the fact that similar royalty and technical payments have been accepted…

M/S. Bright Enterprises Pvt. Ltd., Jalandhar vs. Asstt. Commissioner of Income-Tax, Jalandhar

In the result, the appeal of the assessee in ITA No

ITA 126/ASR/2015[2012-13]Status: DisposedITAT Amritsar17 Jan 2019AY 2012-13

Bench: Sh. N. K. Saini, Hon’Ble & Sh. Ravish Soodita No.354/Asr./2014 : Asstt. Year : 2010-11 Ita No.126/Asr./2015 : Asstt. Year : 2012-13 M/S Bright Enterprises Pvt. Ltd., Vs Deputy Commissioner Of Income Mbd House, Railway Road, Tax, Central Circle-Ii, Jalandhar Jalandhar (Appellant) (Respondent) Pan No. Aaacb9469K Assessee By : Sh. Sudhir Sehgal, Adv. Revenue By : Sh. Pawan K. Kumar, Cit Dr Date Of Hearing : 08.01.2019 Date Of Pronouncement : 17.01.2019 Order Per N. K. Saini: These Two Appeals By The Assessee Are Directed Against The Orders Dated 08.05.2014 & 15.01.2015 Of The Ld. Cit(A)-5, Ludhiana For The Assessment Years 2010-11 & 2012-13 Respectively. 2. Since, The Issues Involved Are Common & The Appeals Were Heard Together, So These Are Being Disposed Off By This Consolidated Order For The Sake Of Convenience & Brevity.

For Appellant: Sh. Sudhir Sehgal, AdvFor Respondent: Sh. Pawan K. Kumar, CIT DR
Section 40A(2)(b)Section 4G

…eliance is placed on the following judgments: ITA No. 354/Asr./2014 11 Bright Enterprises Pvt. Ltd. • Commissioner of Income Tax, Bombay v M/s Walchand & Co. (Pvt.) Ltd., Bombay 65 ITR 381 (1967) (SC) (discussed above) • CIT v Dhanrajgirji Raja Narasirgirji 91 ITR 544 (1973) (SC) (discussed above) • CIT v Panipat Woolen and General Mills 103 ITR 66 (1976)(SC) (discussed above) • In the case of Hive Communication (P.) Ltd. v CIT 201 Taxman 99 (2011), the Hon'ble Delhi High Court held as under: "The legitimate business needs of the company must be judged from the viewpoint of the company itself and must be view…

M/S Bright Enterprises Pvt. Ltd, Jalandhar vs. The Dy. Commissioner of Income-Tax, Jalandhar

In the result, the appeal of the assessee in ITA No

ITA 354/ASR/2014[2010-11]Status: DisposedITAT Amritsar17 Jan 2019AY 2010-11

Bench: Sh. N. K. Saini, Hon’Ble & Sh. Ravish Soodita No.354/Asr./2014 : Asstt. Year : 2010-11 Ita No.126/Asr./2015 : Asstt. Year : 2012-13 M/S Bright Enterprises Pvt. Ltd., Vs Deputy Commissioner Of Income Mbd House, Railway Road, Tax, Central Circle-Ii, Jalandhar Jalandhar (Appellant) (Respondent) Pan No. Aaacb9469K Assessee By : Sh. Sudhir Sehgal, Adv. Revenue By : Sh. Pawan K. Kumar, Cit Dr Date Of Hearing : 08.01.2019 Date Of Pronouncement : 17.01.2019 Order Per N. K. Saini: These Two Appeals By The Assessee Are Directed Against The Orders Dated 08.05.2014 & 15.01.2015 Of The Ld. Cit(A)-5, Ludhiana For The Assessment Years 2010-11 & 2012-13 Respectively. 2. Since, The Issues Involved Are Common & The Appeals Were Heard Together, So These Are Being Disposed Off By This Consolidated Order For The Sake Of Convenience & Brevity.

For Appellant: Sh. Sudhir Sehgal, AdvFor Respondent: Sh. Pawan K. Kumar, CIT DR
Section 40A(2)(b)Section 4G

…eliance is placed on the following judgments: ITA No. 354/Asr./2014 11 Bright Enterprises Pvt. Ltd. • Commissioner of Income Tax, Bombay v M/s Walchand & Co. (Pvt.) Ltd., Bombay 65 ITR 381 (1967) (SC) (discussed above) • CIT v Dhanrajgirji Raja Narasirgirji 91 ITR 544 (1973) (SC) (discussed above) • CIT v Panipat Woolen and General Mills 103 ITR 66 (1976)(SC) (discussed above) • In the case of Hive Communication (P.) Ltd. v CIT 201 Taxman 99 (2011), the Hon'ble Delhi High Court held as under: "The legitimate business needs of the company must be judged from the viewpoint of the company itself and must be view…

Uma Singal, New Delhi vs. ACIT, Centrl Circle-3, New Delhi

ITA 1484/DEL/2018[2014-15]Status: DisposedITAT Delhi07 Dec 2018AY 2014-15

Bench: Shri Bhavnesh Saini & Shri Prashant Maharishi

For Appellant: Shri S. K. Tulsiyan, AdvFor Respondent: Shri S S Rana CIT DR
Section 10(38)Section 143Section 153ASection 250Section 68

…rity is estopped from stepping into the shoes of any assessee so as to question its rationality, prudence or acceptability from a common sense point of view [see S.A. Builders Ltd. v. CIT [2007] 288 ITR 1 (S.C); CIT Vs. Dhanraj Girji Raja Narasingherji (1973) 91 ITR 544 (SC); CIT Vs. Walchand and Co. (1967) 65 ITR 381 (SC)]. So long as the transaction meets the specific conditions laid down in the Act, an attempt to negate it or interpret it by applying the yardsticks of rationality, prudence etc., which in any case is highly subjective, would not meet the ends of justice and basic tenets of judicial interpretati…

Ritu Singal, New Delhi vs. ACIT, Central Circle- 3, New Delhi

ITA 1481/DEL/2018[2015-16]Status: DisposedITAT Delhi07 Dec 2018AY 2015-16

Bench: Shri Bhavnesh Saini & Shri Prashant Maharishi

For Appellant: Shri S. K. Tulsiyan, AdvFor Respondent: Shri S S Rana CIT DR
Section 10(38)Section 143Section 153ASection 250Section 68

…rity is estopped from stepping into the shoes of any assessee so as to question its rationality, prudence or acceptability from a common sense point of view [see S.A. Builders Ltd. v. CIT [2007] 288 ITR 1 (S.C); CIT Vs. Dhanraj Girji Raja Narasingherji (1973) 91 ITR 544 (SC); CIT Vs. Walchand and Co. (1967) 65 ITR 381 (SC)]. So long as the transaction meets the specific conditions laid down in the Act, an attempt to negate it or interpret it by applying the yardsticks of rationality, prudence etc., which in any case is highly subjective, would not meet the ends of justice and basic tenets of judicial interpretati…

Garg Tubes Ltd., Delhi vs. DCIT, New Delhi

In the result, the Appeal of the assessee is allowed

ITA 1837/DEL/2015[2010-11]Status: DisposedITAT Delhi29 Oct 2018AY 2010-11

Bench: Shri H.S. Sidhu & Shri L.P. Sahua.Y.: 2010-11

For Appellant: Sh. C.S. Anand, AdvFor Respondent: Smt. Ranu Mukharjee, Sr. Dr
Section 142(1)Section 143(2)

…IN THE INCOME TAX APPELATE TRIBUNAL DELHI BENCH “C”: NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER A.Y.: 2010-11 M/S GARG TUBES LIMITED, VS. DCIT, CIRCLE 12(1), 5006, 3RD FLOOR, JAISAV PALACE, NEW DELHI HAUZ QAZI, DELHI – 110 006 (PAN: AAACG2992G) (Appellant) (Respondent) Assessee by : Sh. C.S. Anand, Adv. Department by : Smt. Ranu Mukharjee, Sr. Dr. O R D E R PER H.S. SIDHU, JM This appeal filed by the Assessee is directed against the Order dated 27.2.2015 of the Ld. CIT(A)-4, New Delhi relevant to assessment year 2010-11 on the following grounds:- 1. That the Ld…

Rukmini Devi Manpuria, Kolkata vs. DCIT(It), Circle - 2(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 1724/KOL/2017[2014-15]Status: DisposedITAT Kolkata24 Oct 2018AY 2014-15

Bench: Hon’Ble Shri A T Varkey, Jm & Shri M.Balaganesh, Am] I.T.A No. 1724/Kol/2017 Assessment Year : 2014-15 Rukmini Devi Manpuria -Vs- Dcit(It), Circle-2(1), Kolkata [Pan: Axapm 3836 H ] (Appellant) (Respondent)

For Appellant: Shri Subash Agarwal, AdvocateFor Respondent: Shri Robin Chowdhury, Addl. CIT Sr. DR
Section 10(38)Section 11(1)Section 143(3)Section 68

…ep into the shoes of the assessee in this regard and participate in the business and investment decisions of the assessee. Reliance in this regard is placed on the decision of Hon’ble Apex Court in the case of CIT vs Dhanrajgirji Raja Narasingirji reported in 91 ITR 544 (SC). The next argument of the ld DR that the contract notes and demat statements are only evidences to prove that the transactions happened and got recorded in the stock exchange and that it does not give credence to the transaction per se. In this regard, we find that the transactions of purchase and sale of shares happen in the secondary market…

ITO, Ward - 32(4), Kolkata vs. M/S. Stuti Welfare Trust, Kolkata

ITA 1508/KOL/2017[2014-15]Status: DisposedITAT Kolkata24 Oct 2018AY 2014-15

Bench: Hon’Ble Shri A T Varkey, Jm & Shri M.Balaganesh, Am] I.T.A No. 1508/Kol/2017 Assessment Year : 2014-15 Ito, Ward-32(4), Kolkata -Vs- M/S Stuti Welfare Trust [Pan: Aacts 8163 Q ] (Appellant) (Respondent)

For Appellant: Shri Altaf Hussain, Addl. CIT Sr. DRFor Respondent: Shri Manish Tiwari, FCA
Section 10(38)Section 143(3)Section 68

…ep into the shoes of the assessee in this regard and participate in the business and investment decisions of the assessee. Reliance in this regard is placed on the decision of Hon’ble Apex Court in the case of CIT vs Dhanrajgirji Raja Narasingirji reported in 91 ITR 544 (SC). The next argument of the ld DR that the contract notes and demat statements are only evidences to prove that the transactions happened and got recorded in the stock exchange and that it does not give credence to the transaction per se. In this regard, we find that the transactions of purchase and sale of shares happen in the secondary market…

M/S. Eaton Power Quality Private Ltd., Pune vs. Deputy Commissioner of Income-Tax

In the result, the appeal of assessee in ITA No

ITA 1373/PUN/2014[2007-08]Status: DisposedITAT Pune11 Sept 2018AY 2007-08

Bench: Shri Anil Chaturvedi, Am & Shri Vikas Awasthy, Jm

For Appellant: Shri Vishal KalraFor Respondent: Shri Rajeev Kumar
Section 143(3)

…nue cannot question the commercial expediency of the assessee:  SA Builders Ltd vs CIT [2007] 288 ITR 1 (SC)  CIT vs Walchand & Co Ltd [1967]65 ITR 381 (SC)  CIT vs B. Dalmia Cement Ltd [2002] 254 ITR 377 (Del)  CIT vs Dhanrajgiri Raja Narasingirji [1973] 91 ITR 544 (SC)  CIT vs Oracle India (P) Ltd [2011] 199 TAXMAN 181 (Delhi)  Hive Communication Private Ltd vs CIT [2013]353 ITR 200 (Del) 4.13 It may also be pointed out that recently the CBDT vide notification G.S.R. 557(E) dated 7th June, 2017, has notified the Safe Harbour Rules, inter alia, for low end intra group services. The CBDT has also acknowledg…

M/S Eaton Power Quality P.Ltd., Pune vs. ACIT, Pune

In the result, the appeal of assessee in ITA No

ITA 119/PUN/2013[2008-09]Status: DisposedITAT Pune11 Sept 2018AY 2008-09

Bench: Shri Anil Chaturvedi, Am & Shri Vikas Awasthy, Jm

For Appellant: Shri Vishal KalraFor Respondent: Shri Rajeev Kumar
Section 143(3)

…nue cannot question the commercial expediency of the assessee:  SA Builders Ltd vs CIT [2007] 288 ITR 1 (SC)  CIT vs Walchand & Co Ltd [1967]65 ITR 381 (SC)  CIT vs B. Dalmia Cement Ltd [2002] 254 ITR 377 (Del)  CIT vs Dhanrajgiri Raja Narasingirji [1973] 91 ITR 544 (SC)  CIT vs Oracle India (P) Ltd [2011] 199 TAXMAN 181 (Delhi)  Hive Communication Private Ltd vs CIT [2013]353 ITR 200 (Del) 4.13 It may also be pointed out that recently the CBDT vide notification G.S.R. 557(E) dated 7th June, 2017, has notified the Safe Harbour Rules, inter alia, for low end intra group services. The CBDT has also acknowledg…

M/S Loesche India Pvt. Ltd., New Delhi vs. Addl. CIT, New Delhi

In the result, the appeal is allowed

ITA 295/DEL/2016[2010-11]Status: DisposedITAT Delhi13 Aug 2018AY 2010-11

Bench: : Shri Amit Shukla & Shri L.P. Sahuassessment Year: 2010-11

Section 17(2)(iv)Section 37Section 37(1)

…In the Income-Tax Appellate Tribunal, Delhi Bench ‘D’, New Delhi Before : Shri Amit Shukla , Judicial Member And Shri L.P. Sahu, Accountant Member Assessment Year: 2010-11 Loesche India Pvt. Ltd., M-38/1, vs. Addl. CIT, Range-15, Intl. Business Centre, Middle Circle, New Delhi. Connaught Place, New Delhi. PAN- AAACL0980H (Appellant) (Respondent) Assessee by Sh. D. Subramanian & Sh. Alkesh Babbar, CA Revenue by Sh. Amit Jain, Sr. DR Date of Hearing 09.08.2018 Date of Pronouncement 13.08.2018 ORDER Per L.P. Sahu, A.M.: This is an appeal filed by the assessee against the order of the ld. CIT(A)-V, Delhi date…

M/S Elem Investment(P)Limited, Hyderabad vs. The Dict, Hyderabad

In the result, appeal of assessee for AY

ITA 121/HYD/2010[2005-06]Status: DisposedITAT Hyderabad03 Aug 2018AY 2005-06

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiahappellant Respondent

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the :- 14 -: M/s. Elem Investments Pvt. Ltd., purposes of th…

M/S Fincity Investments Pvt Ltd, Hyderabad vs. DCIT, Hyderabad

In the result, appeal of assessee for AY

ITA 119/HYD/2010[2005-06]Status: DisposedITAT Hyderabad03 Aug 2018AY 2005-06

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiah

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It :- 14 -: M/s. Fincity Investments Pvt. Ltd., mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purposes of…

M/S Highgrace Investments Pvt Ltd, Hyderabad vs. DCIT, Hyderabad

In the result, appeal of assessee for AY

ITA 114/HYD/2010[2005-06]Status: DisposedITAT Hyderabad03 Aug 2018AY 2005-06

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiahappellant Respondent

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the :- 14 -: M/s. Highgrace Investments Pvt. Ltd., purposes…

M/S Fincity Investments Pvt.Ltd., Hyderabad vs. ACIT, Hyderabad

In the result, appeal of assessee for AY

ITA 591/HYD/2006[2002-03]Status: DisposedITAT Hyderabad03 Aug 2018AY 2002-03

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiah

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It :- 14 -: M/s. Fincity Investments Pvt. Ltd., mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purposes of…

M/S Highgrace Investements Pvt.Ltd., Hyderabad vs. ACIT, Hyderabad

In the result, appeal of assessee for AY

ITA 590/HYD/2006[2002-03]Status: DisposedITAT Hyderabad03 Aug 2018AY 2002-03

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiahappellant Respondent

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the :- 14 -: M/s. Highgrace Investments Pvt. Ltd., purposes…

M/S Elem Investments Pvt.Ltd., Hyderabad vs. ACIT, Hyderabad

In the result, appeal of assessee for AY

ITA 589/HYD/2006[2002-03]Status: DisposedITAT Hyderabad03 Aug 2018AY 2002-03

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiahappellant Respondent

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the :- 14 -: M/s. Elem Investments Pvt. Ltd., purposes of th…

M/S Vecyes Investement Pvt Ltd., Hyderabad vs. ACIT, Hyderabad

In the result, the appeal of assessee is partly allowed

ITA 588/HYD/2006[2002-03]Status: DisposedITAT Hyderabad03 Aug 2018AY 2002-03

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiah

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purposes of the business, reasonableness of the expenditu…

M/S High Grace Investments Pvt.Ltd., Hyderabad vs. ACIT, Hyderabad

In the result, appeal of assessee for AY

ITA 619/HYD/2008[2004-05]Status: DisposedITAT Hyderabad03 Aug 2018AY 2004-05

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiahappellant Respondent

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the :- 14 -: M/s. Highgrace Investments Pvt. Ltd., purposes…

M/S Elem Investments Pvt.Ltd., Hyderabad vs. ACIT, Hyderabad

In the result, appeal of assessee for AY

ITA 617/HYD/2008[2004-05]Status: DisposedITAT Hyderabad03 Aug 2018AY 2004-05

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiahappellant Respondent

For Appellant: Shri K.C. Devdas, ARFor Respondent: Smt. Suman Malik, DR
Section 37(1)Section 40A(2)

…(Cal)). It is for the assessee to decide how best to protect its own interest. It is not open to AO to prescribe what expenditure an assessee should incur and in what circumstances he should incur that expenditure (CIT Vs. Dhanrajgiri Raja Narasingiri (1973) 91 ITR 544 (SC)). Expression "commercial expediency" is not a term of art. It mean everything that serves to promote commerce and includes every means suitable to that end. In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the :- 14 -: M/s. Elem Investments Pvt. Ltd., purposes of th…