CIT v. Kerala State Drugs and Pharmaceutical Lts

192 ITR 1High Court1991#8266 most cited

What is CIT v. Kerala State Drugs and Pharmaceutical Lts authority for?

Only real income, not hypothetical income, is chargeable to tax, even under the mercantile system of accounting. The true nature of a transaction and whether it has resulted in profit or loss must be considered for taxability.

13

judgments rely on this decision, according to BharatTax’s citation analysis of 366,315 Indian tax judgments — from 2016 to 2022.

Also referred to as

CIT v. Kerala State Drugs & Pharmaceuticals Ltd. · real income · hypothetical income · accrual of income · mercantile system of accounting · chargeability to tax · true nature of transaction · profit or loss

Judgments citing CIT v. Kerala State Drugs and Pharmaceutical Lts

Velankani Information Systems Limited, Bangalore vs. The Deputy Commissioner of Income Tax Circle-7(1)(2), Bangalore

In the result, the appeal by the assessee is dismissed

ITA 156/BANG/2017[2010-11]Status: DisposedITAT Bangalore20 Jan 2022AY 2010-11

Bench: Shri N V Vasudevan & Shri Chandra Poojariassessment Year: 2010-11

For Appellant: Shri Sudhir Prabhu, CAFor Respondent: Shri Sankarganesh, Jt.CIT(DR)(ITAT), Bengaluru
Section 30Section 37Section 37(1)

…, which arises only in proportion to or commensurate with the actual performance or the actual discharge of the assessee’s duties. Similar views were expressed by Hon’ble Kerala High Court in the case of CIT v. Kerala State Drugs & Pharmaceuticals Ltd. [1991] 192 ITR 1 (Ker.) that only accrual of real income (and not hypothetical income) was chargeable to tax. 17. According to the CIT(Appeals), in the instant case the assessee has received the entire amount in the first year of the agreement i.e. F.Y. 2009- 10 corresponding to A.Y. 2010-11. The assessee has also claimed expenditure on this amount, thus the amoun…

Assistant Commissioner of Income Tax Circle-1, Bellary vs. Shri Vazhyiel House Narayanan Kutty Menon, Bellary

In the result, the revenue’s appeal is partly allowed for statistical purposes

ITA 1545/BANG/2018[2014-15]Status: DisposedITAT Bangalore05 Oct 2021AY 2014-15

Bench: Shri Chandra Poojari & Shri George George K.Assessment Year : 2014-15

For Appellant: Shri B.K. Singh, CIT(DR)(ITAT), BengaluruFor Respondent: Shri B.S. Balachandran, Advocate

…at all, there is obviously neither accrual nor receipt of the income, even though an entry to that effect might, in certain circumstances, have been made in the books of account.” A.13.4. In CIT vs Kerala State Drugs & Pharmaceuticals Ltd., reported in (1991) 192 ITR 1, Hon’ble Kerala High Court observed and held as under: “In order to tax on income, one has to see whether it is the real income or whether the income has materialised. What is necessary to be considered is the true nature of the transaction and whether in fact the transaction has resulted in profit or loss to the assessee. Once accrual takes place…

M/S Gogga Gurusanthaiah and Brothers, Hospet vs. The Assistant Commissioner of Income Tax Circle-1, Bellary

In the result, the appeals filed by the assessee are partly allowed as indicated above

ITA 3319/BANG/2018[2015-16]Status: DisposedITAT Bangalore28 Jul 2021AY 2015-16

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm

For Appellant: Sri.Sivaprasad Reddy, AdvocateFor Respondent: Sri.Pradeep Kumar, CIT-DR
Section 37

…at all, there is obviously neither accrual nor receipt of the income, even though an entry to that effect might, in certain circumstances, have been made in the books of account.” A.13.4. In CIT vs Kerala State Drugs & Pharmaceuticals Ltd., reported in (1991) 192 ITR 1, Hon’ble Kerala High Court observed and held as under: “In order to tax on income, one has to see whether it is the real income or whether the income has materialised. What is necessary to be considered is the true nature of the transaction and whether in fact the transaction has resulted in profit or loss to the assessee. Once accrual takes place…

M/S Gogga Gurusanthaiah and Brothers, Hospet vs. The Assistant Commissioner of Income Tax Circle-1, Bellary

In the result, the appeals filed by the assessee are partly allowed as indicated above

ITA 3318/BANG/2018[2014-15]Status: DisposedITAT Bangalore28 Jul 2021AY 2014-15

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm

For Appellant: Sri.Sivaprasad Reddy, AdvocateFor Respondent: Sri.Pradeep Kumar, CIT-DR
Section 37

…at all, there is obviously neither accrual nor receipt of the income, even though an entry to that effect might, in certain circumstances, have been made in the books of account.” A.13.4. In CIT vs Kerala State Drugs & Pharmaceuticals Ltd., reported in (1991) 192 ITR 1, Hon’ble Kerala High Court observed and held as under: “In order to tax on income, one has to see whether it is the real income or whether the income has materialised. What is necessary to be considered is the true nature of the transaction and whether in fact the transaction has resulted in profit or loss to the assessee. Once accrual takes place…

M/S Gogga Gurusanthaiah and Brothers, Hospet vs. The Assistant Commissioner of Income Tax Circle-1, Bellary

In the result, the appeals filed by the assessee are partly allowed as indicated above

ITA 3317/BANG/2018[2013-14]Status: DisposedITAT Bangalore28 Jul 2021AY 2013-14

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm

For Appellant: Sri.Sivaprasad Reddy, AdvocateFor Respondent: Sri.Pradeep Kumar, CIT-DR
Section 37

…at all, there is obviously neither accrual nor receipt of the income, even though an entry to that effect might, in certain circumstances, have been made in the books of account.” A.13.4. In CIT vs Kerala State Drugs & Pharmaceuticals Ltd., reported in (1991) 192 ITR 1, Hon’ble Kerala High Court observed and held as under: “In order to tax on income, one has to see whether it is the real income or whether the income has materialised. What is necessary to be considered is the true nature of the transaction and whether in fact the transaction has resulted in profit or loss to the assessee. Once accrual takes place…

M/S. Veerabhadrappa Sangappa & Company, Sandur vs. The Assistant Commissioner of Income Tax, Circle- 1, Bellary

In the result appeal filed by assessee stands partly allowed

ITA 1054/BANG/2019[2013-14]Status: DisposedITAT Bangalore08 Dec 2020AY 2013-14

Bench: Shri. B. R. Baskaran & Smt. Beena Pillaiassessment Year : 2013–14

For Appellant: Shri Chythanya K.K, AdvocateFor Respondent: Shri Muzaffar Hussain, CIT
Section 145Section 28Section 5

…at all, there is obviously neither accrual nor receipt of the income, even though an entry to that effect might, in certain circumstances, have been made in the books of account.” A.13.4. In CIT vs Kerala State Drugs & Pharmaceuticals Ltd., reported in (1991) 192 ITR 1, Hon’ble Kerala High Court observed and held as under: “In order to tax on income, one has to see whether it is the real income or whether the income has materialised. What is necessary to be considered is the true nature of the transaction and whether in fact the transaction has resulted in profit or loss to the assessee. Once accrual takes place…

DCIT 8(1), Mumbai vs. Aptech Ltd, Mumbai

The appeal of the revenue is dismissed

ITA 2003/MUM/2014[2009-10]Status: DisposedITAT Mumbai06 Oct 2016AY 2009-10

Bench: Hon’Ble S/Shri Joginder Singh (Jm) & Rajesh Kumar,(Am) आमकय अऩीर सं./I.T.A. No.946 & 723/Mum/2013 (ननधधायण वषा / Assessment Year :2007-08 & 2008-09)

For Appellant: Shri S C Tiwari and Rutuja N
Section 14ASection 40

…he billed amount was not accepted by the customers. The ld. Counsel in defence of his argument relied upon the decision in the case of : a) CIT Vs. Bharat Petroleum Corporation Ltd. (1993) 202 ITR 492 (Cal) b) CIT V/s Kerala State Drugs and Pharmaceutical Lts 192 ITR 1 (Ker); c) CIT V/s Sikaria Sons and co. 216 ITR 440(Gau); Indian Overseas Bank V/s CIT 183 ITR 200(Mad) The ld.counsel further submitted that the assessee fulfilled all the conditions enumerated under section 37(1) of the Act. The ld. Counsel also submitted that Rs.2,50,00,000/- was part of the billed amount which was already treated and included…

Aptech Ltd, Mumbai vs. DCIT 8(1), Mumbai

The appeal of the revenue is dismissed

ITA 1271/MUM/2014[2009-10]Status: DisposedITAT Mumbai06 Oct 2016AY 2009-10

Bench: Hon’Ble S/Shri Joginder Singh (Jm) & Rajesh Kumar,(Am) आमकय अऩीर सं./I.T.A. No.946 & 723/Mum/2013 (ननधधायण वषा / Assessment Year :2007-08 & 2008-09)

For Appellant: Shri S C Tiwari and Rutuja N
Section 14ASection 40

…he billed amount was not accepted by the customers. The ld. Counsel in defence of his argument relied upon the decision in the case of : a) CIT Vs. Bharat Petroleum Corporation Ltd. (1993) 202 ITR 492 (Cal) b) CIT V/s Kerala State Drugs and Pharmaceutical Lts 192 ITR 1 (Ker); c) CIT V/s Sikaria Sons and co. 216 ITR 440(Gau); Indian Overseas Bank V/s CIT 183 ITR 200(Mad) The ld.counsel further submitted that the assessee fulfilled all the conditions enumerated under section 37(1) of the Act. The ld. Counsel also submitted that Rs.2,50,00,000/- was part of the billed amount which was already treated and included…

Aptech Ltd, Mumbai vs. DCIT 8(1), Mumbai

The appeal of the revenue is dismissed

ITA 946/MUM/2013[2007-08]Status: DisposedITAT Mumbai06 Oct 2016AY 2007-08

Bench: Hon’Ble S/Shri Joginder Singh (Jm) & Rajesh Kumar,(Am) आमकय अऩीर सं./I.T.A. No.946 & 723/Mum/2013 (ननधधायण वषा / Assessment Year :2007-08 & 2008-09)

For Appellant: Shri S C Tiwari and Rutuja N
Section 14ASection 40

…he billed amount was not accepted by the customers. The ld. Counsel in defence of his argument relied upon the decision in the case of : a) CIT Vs. Bharat Petroleum Corporation Ltd. (1993) 202 ITR 492 (Cal) b) CIT V/s Kerala State Drugs and Pharmaceutical Lts 192 ITR 1 (Ker); c) CIT V/s Sikaria Sons and co. 216 ITR 440(Gau); Indian Overseas Bank V/s CIT 183 ITR 200(Mad) The ld.counsel further submitted that the assessee fulfilled all the conditions enumerated under section 37(1) of the Act. The ld. Counsel also submitted that Rs.2,50,00,000/- was part of the billed amount which was already treated and included…

Aptech Ltd, Mumbai vs. DCIT 8(1), Mumbai

The appeal of the revenue is dismissed

ITA 723/MUM/2013[2008--09]Status: DisposedITAT Mumbai06 Oct 2016

Bench: Hon’Ble S/Shri Joginder Singh (Jm) & Rajesh Kumar,(Am) आमकय अऩीर सं./I.T.A. No.946 & 723/Mum/2013 (ननधधायण वषा / Assessment Year :2007-08 & 2008-09)

For Appellant: Shri S C Tiwari and Rutuja N
Section 14ASection 40

…he billed amount was not accepted by the customers. The ld. Counsel in defence of his argument relied upon the decision in the case of : a) CIT Vs. Bharat Petroleum Corporation Ltd. (1993) 202 ITR 492 (Cal) b) CIT V/s Kerala State Drugs and Pharmaceutical Lts 192 ITR 1 (Ker); c) CIT V/s Sikaria Sons and co. 216 ITR 440(Gau); Indian Overseas Bank V/s CIT 183 ITR 200(Mad) The ld.counsel further submitted that the assessee fulfilled all the conditions enumerated under section 37(1) of the Act. The ld. Counsel also submitted that Rs.2,50,00,000/- was part of the billed amount which was already treated and included…

DCIT 8(1), Mumbai vs. Apatech Ltd, Mumbai

The appeal of the revenue is dismissed

ITA 1228/MUM/2013[2008-09]Status: DisposedITAT Mumbai06 Oct 2016AY 2008-09

Bench: Hon’Ble S/Shri Joginder Singh (Jm) & Rajesh Kumar,(Am) आमकय अऩीर सं./I.T.A. No.946 & 723/Mum/2013 (ननधधायण वषा / Assessment Year :2007-08 & 2008-09)

For Appellant: Shri S C Tiwari and Rutuja N
Section 14ASection 40

…he billed amount was not accepted by the customers. The ld. Counsel in defence of his argument relied upon the decision in the case of : a) CIT Vs. Bharat Petroleum Corporation Ltd. (1993) 202 ITR 492 (Cal) b) CIT V/s Kerala State Drugs and Pharmaceutical Lts 192 ITR 1 (Ker); c) CIT V/s Sikaria Sons and co. 216 ITR 440(Gau); Indian Overseas Bank V/s CIT 183 ITR 200(Mad) The ld.counsel further submitted that the assessee fulfilled all the conditions enumerated under section 37(1) of the Act. The ld. Counsel also submitted that Rs.2,50,00,000/- was part of the billed amount which was already treated and included…

ACIT 8(1), Mumbai vs. Apatech Ltd, Mumbai

The appeal of the revenue is dismissed

ITA 1227/MUM/2013[2007-08]Status: DisposedITAT Mumbai06 Oct 2016AY 2007-08

Bench: Hon’Ble S/Shri Joginder Singh (Jm) & Rajesh Kumar,(Am) आमकय अऩीर सं./I.T.A. No.946 & 723/Mum/2013 (ननधधायण वषा / Assessment Year :2007-08 & 2008-09)

For Appellant: Shri S C Tiwari and Rutuja N
Section 14ASection 40

…he billed amount was not accepted by the customers. The ld. Counsel in defence of his argument relied upon the decision in the case of : a) CIT Vs. Bharat Petroleum Corporation Ltd. (1993) 202 ITR 492 (Cal) b) CIT V/s Kerala State Drugs and Pharmaceutical Lts 192 ITR 1 (Ker); c) CIT V/s Sikaria Sons and co. 216 ITR 440(Gau); Indian Overseas Bank V/s CIT 183 ITR 200(Mad) The ld.counsel further submitted that the assessee fulfilled all the conditions enumerated under section 37(1) of the Act. The ld. Counsel also submitted that Rs.2,50,00,000/- was part of the billed amount which was already treated and included…

DCIT, Bangalore vs. M/S Big Bags Inernational Pvt. Ltd., Bangalore

In the result, the appeal filed by the revenue is partly allowed

ITA 1041/BANG/2014[2010-11]Status: DisposedITAT Bangalore06 May 2016AY 2010-11

Bench: Shri Vijay Pal Rao & Shri Inturi Rama Raodeputy Commissioner Of Income-Tax, Circle 11(2), Bangalore. … Appellant Vs. M/S.Big Bags International Pvt. Ltd. No.61, Nadakerappa Industrial Estate, Viswadeepam Post, Peenya, … Respondent Bangalore-560091. Pan:Aabcb 4004 D

For Appellant: Ms. Neera Malhotra, CIT(DR)For Respondent: Shri S.V.Ravishankar, Advocate
Section 143(1)Section 36(1)(vii)Section 36(2)

…assessee-company had not accrued. In support of this proposition, respondent-assessee-company relied on the following decisions: Page 8 of 9 i. CIT vs. Bharat Petroleum Corporation Ltd. (202 ITR 492)(Cal); ii. CIT vs. Kerala State Drugs & Pharmaceuticals Ltd.(192 ITR 1)(Ker); iii. CIT vs. Rehmat Khan (213 ITR 134)(Raj); iv. CIT vs. Sikaria Sons & Co. (216 ITR 440)(Gauhati); v. Godhra Electricity Co. Ltd. vs. CIT (225 ITR 746)(SC); and vi. P.Mariappa Gounder vs. CIT (232 ITR 2)(SC) Thus, going by the submissions of the respondent-assessee- company, there was never any debt/debts. A bad debt pre- supposes the exis…

CIT v. Kerala State Drugs and Pharmaceutical Lts (192 ITR 1) — Cited in 13 Judgments | BharatTax