CIT v. Madras Refineries Ltd.

266 ITR 170High Court2004#1206 most cited

What is CIT v. Madras Refineries Ltd. authority for?

Expenses incurred for community development, even if not directly linked to business operations, can be considered allowable business expenditure if they foster goodwill and are part of evolving business practices.

94

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2013 to 2026.

Also referred to as

CIT v. Madras Refineries Ltd. · section 37(1) · business expenditure · community development expenses · goodwill · corporate social responsibility · allowable expenses · evolving concept of business

Also reported as

138 Taxmann 261

Sections most often in play

Section 14ASection 37(1)Section 115JBSection 135Section 143(3)Section 154Section 8DSection 143(1)(a)

Issues it is cited on

section 35acsection 36(1)(viia)(c)section 40(a)(1)section 80ia(1)section 80hhesection 35absection 248section 135section 35acsr expendituresection 9(1)(vii)(b)substance over form

Judgments citing CIT v. Madras Refineries Ltd.

Bengal NRI Complex Limited, Kolkata vs. DCIT, Circle - 6(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 2231/KOL/2017[2014-15]Status: DisposedITAT Kolkata30 Nov 2018AY 2014-15

Bench: "ी जे. सुधाकर रे"डी, लेखा सद"य एवं/And "ी ऐ. ट". वक", "यायीक सद"य) [Before Shri J. Sudhakar Reddy, Am & Shri A. T. Varkey, Jm]

Section 135Section 36(1)Section 37(1)

…citizen brings goodwill of the local community as also with the regulatory agencies and society at large, thereby creating an atmosphere in which the business can succeed in a greater measure with the aid of such goodwill (CIT v. Madras Refineries Ltd. [2004]266 ITR 170, Sri Venkata Satyanarayna Rice Mill Contractors Co. v. CIT [1997] 223 ITR 101, Hindustan Petroleum Corporation Ltd Vs DCIT [(2005) 96 ITO 186 (Bom)] (iii) The amendment in the scheme of Section 37(1), which has been introduced with effect from 1st April 2015, cannot be construed as to disadvantage to the assessee in the period prior to this amend…

Maruti Suzuki India Ltd., New Delhi vs. Addl. CIT, New Delhi

Appeal of the assessee is partly allowed for statistical purpose

ITA 467/DEL/2014[2009-10]Status: DisposedITAT Delhi17 Oct 2018AY 2009-10

Bench: Shri R. K. Panda & Ms Suchitra Kamblei.T.A .No. 467/Del/2014 (A.Y 2009-10)

Section 143(3)Section 144CSection 144C(5)Section 43Section 43B

…expenses are allowable as revenue expenditure, as has been held in the following decisions: i) Sri Venkata Satyanarayana Rice Mill Contractors Co v. CIT: 223 ITR 101 ii) CIT v. Ranbaxy Laboratories Ltd. : ITA No.743 of 2008 iii) CIT v. Madras Refineries Ltd.: 266 ITR 170 (Mad.) iv) CIT v. Rajasthan Spinning and Weaving Mills Ltd.: 281 ITR 408 (Raj.), The Rajasthan High Court, while relying on its decision in the assessee’s own case reported at 274 ITR 465 decided the issue in favour of the assessee. v) The Bombay High Court in the case of Krishna Sahakari Sakhar Karkhana Ltd v. CIT: 229 ITR 577 held that contri…

Hero Motocorp Ltd., New Delhi vs. Addl.CIT, Range-11, New Delhi

In the result ground No

ITA 6990/DEL/2017[2013-14]Status: DisposedITAT Delhi20 Jun 2018AY 2013-14

Bench: Shri R. K. Panda & Ms Suchitra Kamblei.T.A. No. 6990/Del/2017 (A.Y 2013-14)

Section 143(3)Section 144C

…lfare of corporate entities who were its members and whose interests were taken care of by the Chamber, the expenditure was deductible, irrespective of whether the expense incurred was compulsory or otherwise. (v) In the case of CIT v. Madras Refineries Ltd.: 266 ITR 170, the Madras High Court observed as under: “The concept of business is not static. It has evolved over a period of time to include within its fold the concrete expression of care and concern for the society at large and the people of the locality in which the business is located in particular. Being known as a good corporate citizen brings goodwil…

Hero Motocorp Ltd., New Delhi vs. DCIT, New Delhi

In the result appeal No. 2424/Del/ 2015 filed by the revenue in assessment year 2010-11 is partly allowed

ITA 1616/DEL/2017[2012-13]Status: DisposedITAT Delhi13 Jun 2018AY 2012-13

Bench: Shri R. K. Panda & Ms Suchitra Kamble

Section 143(3)Section 144CSection 92C

…lfare of corporate entities who were its members and whose interests were taken care of by the Chamber, the expenditure was deductible, irrespective of whether the expense incurred was compulsory or otherwise. (v) In the case of CIT v. Madras Refineries Ltd.: 266 ITR 170, the Madras High Court observed as under: “The concept of business is not static. It has evolved over a period of time to include within its fold the concrete expression of care and concern for the society at large and the people of the locality in which the business is located in particular. Being known as a good corporate citizen brings goodwil…

Rajasthan State Industrial Development & Investment Corp. Ltd., Jaipur vs. ACIT, Jaipur

In the result, both set of cross appeals for the respective assessment years are disposed off with above directions

ITA 380/JPR/2017[2013-14]Status: DisposedITAT Jaipur29 Mar 2018AY 2013-14
For Appellant: Shri P C ParwalFor Respondent: Shri Varindar Mehta (CIT) fu/kZkfjrh dh vksj ls@
Section 115JSection 14ASection 80I

…61 ITD 0043 (Chennai) • NMDC LTD. vs. JCIT(2015) 43 CCH 0491 / 68 SOT 0199 (Hyd) (Trib) Rajasthan State Industries Development & Investment Corp. Ltd. • CIT & ANR vs. Infosys Technologies Ltd.(2014) 360 ITR 0714 (Kar) • CIT Vs. Madras Refineries Ltd., (2004) 266 ITR 170 (Madras) • CIT &Anr.Vs. Karnataka Financial Corporation (2010) 326 ITR 355 (Kar) 3.9 It was further submitted that the Tribunal in assessee’s own case for AY 2012-13 in its order dated 23.02.2018 with reference to expenditure incurred for providing training through apparel training and development centre held that when CSR expenditure in not all…

Dy. C.I.T.1(1), Bilaspur(Cg) vs. Jspl, Raigarh(C.G)

In the result, the appeal is partly allowed

ITA 210/BIL/2014[2009-10]Status: DisposedITAT Raipur15 Jan 2018AY 2009-10

Bench: : Shri N.S.Saini & Shri Pavan Kumar Gadale, Judical Member Dcit-1(1), Bilaspur- Vs Jspl, 495004 Kharsia Road, Raighagh(Cg) Pan No. : Aabcj 4683 J (Appellant) .. Tsednepser Revenue By : Shri Sanjay Kumar, Dr Assessee By : Shri Mayank Jain, Ar Date Of Hearing : 12/01/2018 Date Of Pronouncement 15/01/2018 आदेश / O R D E R Per Shri N.S.Saini, Am: This Is An Appeal Filed By The Revenue Against The Order Of The Cit(A), Bilaspur, Dated 31.03.2014 For The Assessment Year 2009-2010. 2. The Sole Grievance Of The Revenue Is That The Cit(A) Erred In Deleting The Amount To The Extent Of Rs.2,10,89,707/- Out Of Disallowance Of Rs.3,36,18,098/- Made By The Ao Under The Head Corporate Social Responsibility Expenses. 3. Brief Facts Of The Case Are That The Assessee Is A Domestic Company, A Subsidiary Of Jindal Steel &.Power Limited (Jspl). It Derives Income From Power Generation & Mining. The Company Has Commenced The Commercial Generation Of Thermal Power From Its First Of The Four Units Of 250Mw Each From 08.12.2007. The Assessee Company Filed Its Income Tax Return For The Year Under Consideration Declaring

For Appellant: Shri Mayank Jain, ARFor Respondent: Shri Sanjay Kumar, DR
Section 37Section 37(1)

…above heads incurred by the appellant company as a good corporate citizen and as measure of gaining goodwill of the people living in and around its industries through the aforesaid activities are admissible expenditures as held in CIT Vs. Madras Ref' '.2004) 266 ITR 170 (Mad.) and other judicial pronouncement relied upon by the Ld. AR. In view of the above, legal propositions, guidelines and stipulation put forth by various government agencies like pollution board and local administration, the expenses under the head CSR booked in the P&L A/c was examined by the undersigned and observation made are enumerated h…

DCIT, Circle-1(1), Bhubaneswar vs. M/S. Paradeep Phosphates Limited, Bhubaneswar

In the result, appeal filed by the revenue is dismissed and that of

ITA 289/CTK/2014[2010-11]Status: DisposedITAT Cuttack04 Aug 2017AY 2010-11

Bench: S/Shri N.S Saini & Pavan Kumar Gadaleassessment Year : 2010-2011

For Appellant: Shri B.K.MohapatraFor Respondent: Shri Kunal Singh, CIT DR
Section 195Section 195(1)Section 195(2)Section 197Section 263Section 40Section 92

…school) does not fall under the ambit of provisions of section 40A(9) of the I.T Act and therefore the said disallowance u/s 40A (9) of the Act is legally untenable. In this regard reliance can be placed on the case of CIT vs Madras Refinery Limited [(2004) 266 ITR 170(Mad)], where the High Court adjudicated that the expenditure incurred for public welfare was in relation to promoting the business in the local community, thereby was incurred for the purpose of business. It may be mentioned here that the Hon'ble ITAT Delhi Bench in the case of CIT V Gujarat Guardian Ltd [2006] 152 Taxman 37 (Delhi) (Mag) held th…

Rajasthan State Mines & Minerals Ltd., Jaipur vs. ACIT, Jaipur

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

ITA 253/JPR/2015[2007-08]Status: DisposedITAT Jaipur30 May 2017AY 2007-08

…l Contractors Co. Vs. CIT 223 ITR 101(SC) and also the decision the Co-ordinate Bench rendered in the case of Hindustan Petroleum Corporation Ltd. Vs. DCIT 96 ITD 186 (Mum.), the Hon’ble Madras High Court rendered in the case of CIT Vs. Madras Refinery Ltd. 266 ITR 170 (Mad.) (HC) and CIT Vs. India Radiators Ltd. 236 ITR 719 (Mad.) (HC). 72.1 On the contrary, the Ld. Departmental Representatives supported the order of the authorities below. 72.3 We have heard the rival contentions; we are unable to accept the contentions of the Ld. Counsel for the assessee that the expenditure is allowable as the same was…

M/S.Cochin Shipyard Ltd, Cochin vs. The Adcit, Cochin

In the result, the appeal of the assessee is dismissed

ITA 124/COCH/2016[2011-12]Status: DisposedITAT Cochin23 Mar 2017AY 2011-12

Bench: S/Shri Abraham P. George, Am & George George K., Jm

Section 142(1)Section 143(3)Section 14ASection 263

…s t hat the Assessing Officer had taken a lawful view by allowing the expenses incurred for the benefit of the employees of the assessee- company. Reliance was placed on the judgment of Hon’ble Madras High Court in the case of CIT vs. Madras Refineries Ltd. (266 ITR 170) and the decision of ITAT, Chennai Bench in the case of ITO vs. Velumanickam Lodge (123 ITD 25). For his argument that assessment made in accordance with a judgment of Hon’ble Jurisdictional High Court could not be subjected to revision u/s. 263 of the Act, Ld. AR relied on the judgment of Hon’ble Calcutta High Court in the case of CIT vs. Prade…

M/S. Hindustan Petroleum Corporation Ltd., Mumbai vs. Addl. CIT. RG. - 1(1), Mumbai

In the result, appeal of the Revenue is dismissed

ITA 2736/MUM/2007[2003-2004]Status: DisposedITAT Mumbai23 Nov 2016AY 2003-2004

Bench: Shri R.C. Sharma & Shri Pawan Singh

For Respondent: Shri Rahul Raman, (CIT-DR)
Section 14ASection 253Section 32(1)(ii)Section 35Section 35ASection 36(1)(iii)Section 37(1)Section 80MSection 86

…the Government giving patronage or benefit no ground to deny the assessee a deduction of that amount under section 37(1) of the Act when such payment had been made for the purpose of assessee's business. 8. In the case of CIT u. Madras Refineries Ltd. [2004] 266 ITR 170, Hon'ble Madras High Court has upheld deductibility of the amount spent by the assessee even on bringing drinking water to locality and in aiding local school. While doing so, Their Lordships observed as follows: The concept of business is not static. It has evolved over a period of time to include within its fold the concrete expression of care…

Hero Motocorp Limited, New Delhi vs. JCIT, New Delhi

In the result appeal of the assessee in ITA No

ITA 1545/DEL/2015[2010-11]Status: DisposedITAT Delhi24 Oct 2016AY 2010-11

Bench: Sh. I. C. Sudhir & Shri Prashant Maharishihero Motocorp Limited, Jcit, 34, Basant Lok, Vasant Range-1, New Delhi Vs. Vihar, New Delhi Pan: Aaach0812J (Appellant) (Respondent) Dcit, M/S. Hero Moto Corp. Circle-11(1), Ltd., 34, Community Vs. New Delhi Centre, Basant Lok, Vasant Vihar, New Delhi-110057 (Appellant) (Respondent) Dcit, M/S. Hero Moto Corp. Circle-11(1), Ltd., 34, Community

For Appellant: Sh. Ajay Vohra, Sr. AdvFor Respondent: Sh. NC Sawain, CIT DR
Section 143Section 143(3)Section 144CSection 92C

…age 413 of 484 Meeting Social Responsibilities, which have indirect business nexus: i. VenkataSatyanarayana Rice Mill Contractors Co V. CIT: 223 ITR 101 (SC) ii. CIT Vs. Chemicals and Plastics India Ltd. 292 ITR 115 (Mad.) iii. CIT v. Madras Refineries Ltd.: 266 ITR 170 (Mad) iv. CIT v. Chennai Petroleum Corpn. Ltd: T.C.(A).No.57 of 2006 (Mad.) v. CIT vsJayendrakumarHiralal: 327 ITR 147 (Guj.) vi. CIT vs. Karnataka Financial Corporation: 326 ITR 355 (Kar.) vii. Infosys Technologies Ltd. v. JCIT: 109 TTJ 631 (Bang. Trib.) -affirmed by the Karnataka High Court reported at 360 ITR 714 viii. Ranbaxy Laboratories Ltd…

Regen Powertech Private Lmited, Chennai vs. DCIT, Chennai

In the result, the appeal of the Assessee and Department are allowed for statistical purpose

ITA 786/CHNY/2016[2011-12]Status: DisposedITAT Chennai17 Aug 2016AY 2011-12

Bench: Shri Chandra Poojari & Shri G. Pavan Kumar

For Appellant: Shri. B. Ramakrishnan, FCAFor Respondent: Shri. Anuragh Sahay, CIT
Section 143(2)Section 143(3)Section 14ASection 2(24)(xviii)Section 37(1)

…is offered is for social cause and amendment to Sec. 37(1) of the Act inserted with Finance Act, 2014 is subsequent to assessment year. Therefore, the same is not applicable and assessee company relied the judicial decision of CIT vs. Madras Refineries Ltd 313 ITR 334. Considering the apparent facts, we are of the opinion that the expenditure is for a specific cause for the benefit of society was not disputed by the Revenue on genuineness. So, we direct the ld. Assessing Officer to delete the addition and the ground of the assessee is allowed. The third ground raised by the assessee is that DRP has 6. conf…

DCIT, Chennai vs. Regen Powertech (P) Ltd., Chennai

In the result, the appeal of the Assessee and Department are allowed for statistical purpose

ITA 766/CHNY/2016[2011-12]Status: DisposedITAT Chennai17 Aug 2016AY 2011-12

Bench: Shri Chandra Poojari & Shri G. Pavan Kumar

For Appellant: Shri. B. Ramakrishnan, FCAFor Respondent: Shri. Anuragh Sahay, CIT
Section 143(2)Section 143(3)Section 14ASection 2(24)(xviii)Section 37(1)

…is offered is for social cause and amendment to Sec. 37(1) of the Act inserted with Finance Act, 2014 is subsequent to assessment year. Therefore, the same is not applicable and assessee company relied the judicial decision of CIT vs. Madras Refineries Ltd 313 ITR 334. Considering the apparent facts, we are of the opinion that the expenditure is for a specific cause for the benefit of society was not disputed by the Revenue on genuineness. So, we direct the ld. Assessing Officer to delete the addition and the ground of the assessee is allowed. The third ground raised by the assessee is that DRP has 6. conf…

The Commissioner of Income Tax vs. M/S Wipro Ltd

In the result, the appeals are partly allowed

ITA/133/2007HC Karnataka23 Aug 2013

Bench: B.MANOHAR,DILIP B.BHOSALE

Section 260

…nt’s factory is situated in a backward area and the expenditure incurred is incidental to the carrying on of business in backward area. The learned AR drew our attention to the decision of the Hon’ble Madras High Court in CIT Vs Madras Refineries Ltd. (266 ITR 170) 12 The observations made in paragraph 15.3, to the extent it is necessary read thus: “…………… .…………… Though similar expenditure has been disallowed in the past, the benefit of the above High Court was not available earlier. No contrary decision has been cited. Following the above High Court decision, we…