CIT v. Gopalakrishna Muralidhar

47 ITR 469High Court1963#10639 most cited

What is CIT v. Gopalakrishna Muralidhar authority for?

Interest paid on borrowed funds used for business purposes, including investments in partnership firms, is deductible as a business expenditure under Section 36(1)(iii). Disallowance of interest is not justified if the assessee has sufficient interest-free funds or owned funds, especially when the interest income is not demonstrably excessive compared to expenses.

10

judgments rely on this decision, according to BharatTax’s citation analysis of 366,314 Indian tax judgments — from 2015 to 2023.

Also referred to as

CIT v. Gopalakrishna Muralidhar · 47 ITR 469 · Section 36(1)(iii) · interest deduction · borrowed funds · business purpose · interest-free funds · owned funds · disallowance of interest

Judgments citing CIT v. Gopalakrishna Muralidhar

Naval Kishore Daga, Jodhpur vs. DCIT, CPC, Bangalore

In the result, the appeal of the assessee is allowed

ITA 83/JODH/2021[2017-18]Status: DisposedITAT Jodhpur03 Oct 2023AY 2017-18
Section 143(1)Section 143(1)(a)Section 250Section 57

…ome is more than expenses or Appellant is having sufficient Interest Free Fund or owned Funds: 1. Hon'ble Supreme Court in case of CIT Vs Rajendra Prasad Moody 115 ITR 519 (SC) COME 2. Hon'ble Andhra Pradesh High Court in case of CIT Vs Gopikrishan Murlidhar, 47 ITR 469 (AP) We would like to submit that appellant is having following owned Capital and interest Free Loan as on 31.03.2017." Capital A/c 14458990.00 Unsecured Loan (interest free) Krishna Corporation 4059782.00 Shree Krishan Steel 2531993.50 Shikha Daga 460000.00 Nikhil Daga 50000.00 Krishna Daga 592968.16 Total 22153733.66 Naval Kishore Daga vs. DCIT…

Gautam R. Gupta, Mumbai vs. ACIT- 27 (1), Mumbai

In the result, appeal of the assessee is allowed

ITA 6435/MUM/2018[2014-15]Status: DisposedITAT Mumbai22 Jun 2021AY 2014-15
Section 143(3)Section 36Section 36(1)(iii)

…orm of taxable income or exempt income by the assessee out of utilisation of such borrowed funds. Reliance in this regard is placed on the following decisions:- i) Decision of Andhra Pradesh High Court in the case of CIT vs. Gopikrishna Muralidhar reported in 47 ITR 469 ii) Decision of Hon’ble Calcutta High Court in the case of Woolcombers of India Ltd. vs CIT reported in 134 ITR 219 iii) Decision of Hon’ble Supreme Court in the case of SA Builders Ltd., vs. CIT reported in 288 ITR 1 3.2. We have already held hereinabove that amount invested in partnership firm by the assessee partner is certainly for business p…

Prabhakar Mishra, Kolkata vs. DCIT, Circle-44, Kolkata

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

ITA 2255/KOL/2016[2012-13]Status: DisposedITAT Kolkata24 Oct 2018AY 2012-13

Bench: Hon’Ble Shri A T Varkey, Jm & Shri M.Balaganesh, Am] I.T.A No. 2255/Kol/2016 Assessment Year : 2012-13 Prabhakar Mishra -Vs- Dcit, Circle-44, Kolkata [Pan: Aezpm 7452 B ] (Appellant) (Respondent)

For Appellant: Shri Anil Kochar, AdvocateFor Respondent: Shri Sandeep Lakra, Addl. CIT Sr. DR
Section 143(3)Section 144

…es and Power Ltd reported in 313 ITR 340 (Bom) ; Hon’ble Gujarat High Court in the case of Principal CIT vs India Gelatine and Chemicals Ltd (2015) 376 ITR 553 (Guj) ; Hon’ble Andhrapradesh High Court in the case of CIT vs Gopalakrishna Muralidhar reported in 47 ITR 469 (AP) ; Hon’ble Jurisdictional High Court in the case of Woolcombers of India Ltd vs CIT reported in 134 ITR 219 (Cal) ; Hon’ble Madras High Court in the case of CIT vs Hotel Savera reported in 239 ITR 795 (Mad) and Hon’ble Gujarat High Court in the case of Shree Digvijay Cement Co. Ltd vs CIT reported in 138 ITR 45 (Guj), among others. Respectfull…

DCIT, Cir-2(2), Kolkata vs. M/S Prs Metaliks Ltd., Kolkata

In the result, the appeal of the Revenue ITA No

ITA 450/KOL/2016[2012-2013]Status: DisposedITAT Kolkata10 Jan 2018AY 2012-2013

Bench: : Shri S.S.Viswanethra Ravi & Shri Dr. Arjun Lal Sainia.Y 2012-13

For Appellant: Shri David Z.Chawngthu, Addl.CIT, ld. Sr.DRFor Respondent: Shri Dilip Loyalka, FCA, ld.AR
Section 143(2)Section 143(3)Section 32Section 32(1)Section 43B

…Ltd 356 ITR 625(AP) CIT Vs. Raghuvir Synthetics Ltd 354 ITR 222(Guj) CIT Vs. Reliance Utilities & Power Ltd 313 ITR 340(Bom) CIT Vs. Prem Heavy Engnrs Works P.Ltd 285 ITR 554(All) D & H Secheron Electrodies P.Ltd 142 ITR 528(MP) CIT Vs. Gopikrishna Murlidhar 47 ITR 469 (AP) Regal Theatre Vs. CIT 225 ITR 205(Del) 247 ITR 510(Gau) 16. After considering the above the CIT-A held that the ratio of the cited case laws are found to be squarely applicable to the facts of the present case. He also held that the finding of the AO in disallowing Rs.4,46,817/- as interest for non-business purpose is erroneous and 8 M/s.PRS…

DCIT, Circle - 10, Kolkata vs. M/S. Stadmed Private Ltd., Kolkata

In the result, Revenue’s appeal stands dismissed

ITA 200/KOL/2010[2005-06]Status: DisposedITAT Kolkata18 Jan 2017AY 2005-06

Bench: Shri N.V.Vasudevan & Shri Waseem Ahmed

Section 143(2)Section 143(3)

…t of borrowed funds. It can be said that interest free funds given are out of own funds to the extent of capital and reserves, and this proposition is supported by the decision of Hon'ble Andhra Pradesh High Court in the case of CIT Vs. Gopikrishna Murlidhar, 47 ITR 469 (AP) and in the said case their Lordships accepted the contention that the assessee is entitled to withdraw from capital. The Facts of that case are that the assessee is a Hindu undivided family carrying on business on an extensive scale with a capital of nearly Rs. 20,00,000 (twenty lacs). During the year ended 9th November, 1950, the assessee ma…

Stadmed Private Limited, Kolkata vs. DCIT, Circle - 10, Kolkata

In the result, Revenue’s appeal stands dismissed

ITA 136/KOL/2010[2005-06]Status: DisposedITAT Kolkata18 Jan 2017AY 2005-06

Bench: Shri N.V.Vasudevan & Shri Waseem Ahmed

Section 143(2)Section 143(3)

…t of borrowed funds. It can be said that interest free funds given are out of own funds to the extent of capital and reserves, and this proposition is supported by the decision of Hon'ble Andhra Pradesh High Court in the case of CIT Vs. Gopikrishna Murlidhar, 47 ITR 469 (AP) and in the said case their Lordships accepted the contention that the assessee is entitled to withdraw from capital. The Facts of that case are that the assessee is a Hindu undivided family carrying on business on an extensive scale with a capital of nearly Rs. 20,00,000 (twenty lacs). During the year ended 9th November, 1950, the assessee ma…

D.C.I.T Cir - 12, Kolkata vs. M/S Jct Limited., Kolkata

In the result the appeal by the revenue is dismissed

ITA 1106/KOL/2013[2004-05]Status: DisposedITAT Kolkata19 Oct 2016AY 2004-05

Bench: Hon’Ble Sri N.V.Vasudevan, Jm & Dr.Arjun Lal Saini, Am] I.T.A Nos. 1106 To 1109/Kol/2013 Assessment Years : 2004-05, 2006-07,2007-08 & 2008-09 D.C.I.T., Circle-12, -Vs.- M/S. J.C.T. Ltd. Kolkata Kolkata [Pan : Aaacj 6733 E] (Appellant) (Respondent) For The Appellant : Shri Angam Shaiza, Cit For The Respondent : Shri A.K.Gupta, Fca

For Appellant: Shri Angam Shaiza, CITFor Respondent: Shri A.K.Gupta, FCA
Section 145Section 145ASection 43B

…s sufficient own fund as well as borrowed money, the presumption is that the money is advanced out of own capital instead of borrowed fund. The Assessee placed reliance on the decision of the Hon’ble A.P. High Court in the case of CIT Vs Gopikrishna Murlidhar 47 ITR 469 (AP) whihch was followed by Gujrat High Court in 9 A.Y.2004-05,2006-07 to 2008-09 Digvijay Cement Co Ltd Vs CIT 138 ITR 45. It was further pointed out that in actual business situations, the borrowed fund and own fund are kept in a common pool. Even in case of Cash Credit A/cs, Overdraft A/cs. own funds are deposited therein and where the interest…

DCIT, Circle - 8, Kolkata vs. M/S. Eih Limited, Kolkata

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

ITA 348/KOL/2011[2006-07]Status: DisposedITAT Kolkata01 Jun 2016AY 2006-07

Bench: Shri Mahavir Singh, Jm & Shri M. Balaganesh, Am]

For Respondent: Shri Vijay Shankar, CIT, DR
Section 143(3)Section 195Section 40Section 9(1)(vii)

…used by the group companies and hence had to be construed as advances made during the course of assessee’s business. 7.4.3. We draw our support from the following decisions in support of our findings :- a) CIT vs Gopalakrishna Muralidhar reported in (1963) 47 ITR 469 (AP) b) Woolcombers of India Ltd vs CIT reported in 134 ITR 219 (CAL) c) CIT vs Hotel Savera reported in 239 ITR 795 (MAD) d) CIT vs Britannia Industries Ltd reported in 280 ITR 525 (CAL) e) S A Builders Ltd vs CIT reported in 288 ITR 1 (SC) f) Addl. CIT vs Tulip Star Hotels Ltd in CC No. 7138-7140 / 2012 dated 30.4.2012 by the Supreme Court…

Eih Limited, Kolkata vs. DCIT, Circle - 8, Kolkata

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

ITA 314/KOL/2011[2006-07]Status: DisposedITAT Kolkata01 Jun 2016AY 2006-07

Bench: Shri Mahavir Singh, Jm & Shri M. Balaganesh, Am]

For Respondent: Shri Vijay Shankar, CIT, DR
Section 143(3)Section 195Section 40Section 9(1)(vii)

…used by the group companies and hence had to be construed as advances made during the course of assessee’s business. 7.4.3. We draw our support from the following decisions in support of our findings :- a) CIT vs Gopalakrishna Muralidhar reported in (1963) 47 ITR 469 (AP) b) Woolcombers of India Ltd vs CIT reported in 134 ITR 219 (CAL) c) CIT vs Hotel Savera reported in 239 ITR 795 (MAD) d) CIT vs Britannia Industries Ltd reported in 280 ITR 525 (CAL) e) S A Builders Ltd vs CIT reported in 288 ITR 1 (SC) f) Addl. CIT vs Tulip Star Hotels Ltd in CC No. 7138-7140 / 2012 dated 30.4.2012 by the Supreme Court…

DCIT, Circle - 8, Kolkata vs. M/S. E.I.H. Ltd., Kolkata

In the result, the appeal of the revenue in ITA NO

ITA 2182/KOL/2006[2003-04]Status: DisposedITAT Kolkata09 Dec 2015AY 2003-04

Bench: : Shri M. Balaganesh

For Appellant: Shri R.N Bajoria, Sr.Advocate &For Respondent: Shri Rajat Subhra Biswas, ld.CIT/DR
Section 143(3)Section 195Section 40Section 9(1)(vii)

…used by the group companies and hence had to be construed as advances made during the course of assessee’s business. 7.4.3. We draw our support from the following decisions in support of our findings :- a) CIT vs Gopalakrishna Muralidhar reported in (1963) 47 ITR 469 (AP) b) Woolcombers of India Ltd vs CIT reported in 134 ITR 219 (CAL) c) CIT vs Hotel Savera reported in 239 ITR 795 (MAD) d) CIT vs Britannia Industries Ltd reported in 280 ITR 525 (CAL) e) S A Builders Ltd vs CIT reported in 288 ITR 1 (SC) f) Addl. CIT vs Tulip Star Hotels Ltd in CC No. 7138-7140 / 2012 dated 30.4.2012 by the Supreme Court…