CIT v. Margadarsi Chit Funds (P.) Ltd.

155 ITR 442High Court1985#3645 most cited

What is CIT v. Margadarsi Chit Funds (P.) Ltd. authority for?

The Assessing Officer cannot discard the assessee's method of accounting without recording reasons to do so under Section 145 of the Income Tax Act.

32

judgments rely on this decision, according to BharatTax’s citation analysis of 366,314 Indian tax judgments — from 2015 to 2026.

Also referred to as

CIT v. Margadarsi Chit Funds · Section 145 · rejection of books of account · method of accounting · reasons to discard · profits and gains of business

Sections most often in play

Section 115JBSection 142(1)Section 145Section 145(3)Section 40A(2)(b)Section 127Section 129Section 133A

Issues it is cited on

section 145(1)section 209minimum alternate taxrejection of books of accountblock of assetssection 271aacput to usemercantile system of accountingsection 145(3)profits and gains of business or professionsection 145section 251

Judgments citing CIT v. Margadarsi Chit Funds (P.) Ltd.

D.C.I.T. Central Cricle, Raipur vs. M/S R.R.Energy Ltd., Raigarh(C.G)

In the result, cross objections filed by the assessee for assessment years 2006-07, 2007-08 and 2008-09 are allowed and cross objections filed for the assessment years 2009-10, 2010-11, 2011-12 and...

ITA 228/BIL/2014[2009-10]Status: DisposedITAT Raipur18 Jan 2018AY 2009-10
For Appellant: Shri G.S.Agrawal, ARFor Respondent: Shri P.K.Mishra, CITDR
Section 133(6)Section 68

…ut any defects in the books of accounts nor has any incriminating document been unearthed during operation u/s 132. If any defect in the system and record exists then the A.O. must record a clear finding as held in CITvs Margadarshi Chit Fund Pvt. Ltd. (1985) 155 ITR 442 (AP). In Yaggina Veera Ragha Vulu and Mavuleti Somaraju & Co. vs CIT 62 ITR 528, it was held that assessee is entitled to know the basis for estimation of Turnover and Gross profit. In Seth Nathuram Murmalai 25 ITR 216 (Nagpur), it has been held that ITO must disclose the basis of computation of order and make his order a speaking order to make h…

D.C.I.T. Central Cricle, Raipur vs. M/S R.R.Energy Ltd., Raigarh(C.G)

In the result, cross objections filed by the assessee for assessment years 2006-07, 2007-08 and 2008-09 are allowed and cross objections filed for the assessment years 2009-10, 2010-11, 2011-12 and...

ITA 227/BIL/2014[2008-09]Status: DisposedITAT Raipur18 Jan 2018AY 2008-09
For Appellant: Shri G.S.Agrawal, ARFor Respondent: Shri P.K.Mishra, CITDR
Section 133(6)Section 68

…ut any defects in the books of accounts nor has any incriminating document been unearthed during operation u/s 132. If any defect in the system and record exists then the A.O. must record a clear finding as held in CITvs Margadarshi Chit Fund Pvt. Ltd. (1985) 155 ITR 442 (AP). In Yaggina Veera Ragha Vulu and Mavuleti Somaraju & Co. vs CIT 62 ITR 528, it was held that assessee is entitled to know the basis for estimation of Turnover and Gross profit. In Seth Nathuram Murmalai 25 ITR 216 (Nagpur), it has been held that ITO must disclose the basis of computation of order and make his order a speaking order to make h…

D.C.I.T. Central Cricle, Raipur vs. M/S R.R.Energy Ltd., Raigarh(C.G)

In the result, cross objections filed by the assessee for assessment years 2006-07, 2007-08 and 2008-09 are allowed and cross objections filed for the assessment years 2009-10, 2010-11, 2011-12 and...

ITA 226/BIL/2014[2007-08]Status: DisposedITAT Raipur18 Jan 2018AY 2007-08
For Appellant: Shri G.S.Agrawal, ARFor Respondent: Shri P.K.Mishra, CITDR
Section 133(6)Section 68

…ut any defects in the books of accounts nor has any incriminating document been unearthed during operation u/s 132. If any defect in the system and record exists then the A.O. must record a clear finding as held in CITvs Margadarshi Chit Fund Pvt. Ltd. (1985) 155 ITR 442 (AP). In Yaggina Veera Ragha Vulu and Mavuleti Somaraju & Co. vs CIT 62 ITR 528, it was held that assessee is entitled to know the basis for estimation of Turnover and Gross profit. In Seth Nathuram Murmalai 25 ITR 216 (Nagpur), it has been held that ITO must disclose the basis of computation of order and make his order a speaking order to make h…

D.C.I.T. Central Cricle, Raipur vs. M/S R.R.Energy Ltd., Raigarh(C.G)

In the result, cross objections filed by the assessee for assessment years 2006-07, 2007-08 and 2008-09 are allowed and cross objections filed for the assessment years 2009-10, 2010-11, 2011-12 and...

ITA 225/BIL/2014[2006-07]Status: DisposedITAT Raipur18 Jan 2018AY 2006-07
For Appellant: Shri G.S.Agrawal, ARFor Respondent: Shri P.K.Mishra, CITDR
Section 133(6)Section 68

…ut any defects in the books of accounts nor has any incriminating document been unearthed during operation u/s 132. If any defect in the system and record exists then the A.O. must record a clear finding as held in CITvs Margadarshi Chit Fund Pvt. Ltd. (1985) 155 ITR 442 (AP). In Yaggina Veera Ragha Vulu and Mavuleti Somaraju & Co. vs CIT 62 ITR 528, it was held that assessee is entitled to know the basis for estimation of Turnover and Gross profit. In Seth Nathuram Murmalai 25 ITR 216 (Nagpur), it has been held that ITO must disclose the basis of computation of order and make his order a speaking order to make h…

ITO, WD-43(1), Kolkata vs. M/S Tirupati Commercial, Kolkata

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

ITA 1329/KOL/2015[2011-2012]Status: DisposedITAT Kolkata08 Nov 2017AY 2011-2012

Bench: Hon’Ble Shri M.Balaganesh, Am & Shri S.S.Viswanethra Ravi, Jm] I.T.A No. 1329/Kol/2015 Assessment Year : 2011-12 Ito, Ward-43(1), Kolkata -Vs- M/S Tirupati Commercial [Pan: Aadft 4683 K] (Appellant) (Respondent)

For Appellant: Shri Saurabh Kumar, Addl. CIT (DR)For Respondent: Shri Subash Agarwal, Advocate
Section 133ASection 144Section 145(3)

…finding that the system of accounting followed by the assessee is not reliable for arriving at correct profits before he resorts to rejecting the system of accounting followed by the assessee from year to year." [ CIT v. Margadarsi Chit Funds Pvt. Ltd. (1985) 155 ITR 442 (AP)] "The accounts books of an assessee cannot be rejected merely on the groundoflow profits." [Ramchandra Ramniwas v. State of Orris a, (1970) 25 STC 501 (Orrisa)] The method of accounting followed by us is correct and complete and has been consistently followed over the years. It is supported by all Bills, vouchers and evidences and true an…

Brics Gilt Finance P.Ltd, Mumbai vs. DCIT 1(2), Mumbai

In the result appeal filed by the assessee is hereby Allowed for statistical purpose

ITA 1157/MUM/2014[2010-11]Status: DisposedITAT Mumbai29 Dec 2016AY 2010-11

Bench: Shri G.S.Pannu, Am & Shri Amarjit Singh, Jm आयकरअपीलसं/I.T.A. No.1157/Mum/2014 (िनधा"रणवष" / Assessment Year: 2010-11) Brics Gilt Finance Private बनाम/ Deputy Commissioner Of Ltd. Income Tax 1(2) Vs. 4Th Floor, Sadhna House, Room No.537, 570 P.B.Marg, Aayakar Bhavan, M.K.Road, Behind Mahindra Towers, New Marine Lines, Worli, Mumbai - 400020 Mumbai – 400018 "थायीलेखासं./जीआइआरसं./Pan/Gir No. : Aaacj8885B (अपीलाथ"/Appellant) .. (""थ" /Respondent)

For Appellant: Shri Ronak G. Doshi &For Respondent: Shri M. Rajan
Section 10(34)Section 143(1)Section 143(2)Section 14A

…e Assessing Officer to dishonor the claim of the assessee. No doubt in view of the law settled in Manilal Kher Ambalal & Co. Vs. ITO (176 ITR 253)(Bom) and Trivedi Bros (JA) Vs. CIT (158 ITR 705)(MP) and CIT Vs. A.Y. 2010-11 Margadarshi Chit Funds Pvt. Ltd. (155 ITR 442)(MP) and DCIT Vs. Mewar Textiles Mills Ltd. (64 TTJ 502) (JP-Trib) the finding of the CIT(A) is not liable to be sustainable in the eyes of law. It is also not in dispute that while calculating the average investment for the purpose of Rule 8D of the Act, the strategic investment should be excluded. In this regard there are plethora of judgments…

Asst CIT 24(2), Mumbai vs. Dinesh V. Bahirwani, Mumbai

ITA 7497/MUM/2014[2010-11]Status: DisposedITAT Mumbai18 Oct 2016AY 2010-11

Bench: Shri Sanjay Garg & Shri Ashwani Tanejaassessment Year: 2010-11 Dinesh V. Bahirwani, Dcit 20(2), Unit No.605, Business Suites बनाम/ Mumbai- 9 Ploot No.83, Vs. S.V. Rd, Santacruz(W) Mumbai-400054 (Appellant) (Revenue) P.A. No. Abrpb3559K Assessment Year: 2010-11 Acit 24(2) Dinesh V. Bahirwani, 612, Piramal Chambers, Unit No.605, Business बनाम/ Lalbaug, Suites 9 Ploot No.83, Vs. Mumbai-400012 S.V. Rd, Santacruz(W) Mumbai-400054 (Respondent) (Revenue) P.A. No. Abrpb3559K Appellant By Shri Vipul Shah (Ar) Shri B.S. Bist (Sr. Dr) Revenue By सुनवाई क" तार"ख/Date Of Hearing : 18/10/2016 18/10/2016 आदेश क" तार"ख /Date Of Order: आदेश / O R D E R

Section 143(3)

…pted by the assessee results in underestimation of profits and is therefore rejected. Otherwise, the presumption would be that the entire exercise is revenue neutral." 5.1.4 In the decision rendered in the case of CIT v. Margadarsi Chit Funds (P.) Ltd. [1985] 155 ITR 442 (AP), it was held that the A.O. must refer to the inherent defect in the system and record a clear finding that the system of accounting followed by the assessee is such that correct profits cannot be deduced from the books of account maintained by the assessee. It is not open to the ITO to intervene and substitute a different system of accountin…

Dinesh V Bahirwani, Mumbai vs. DCIT 20(2), Mumbai

ITA 7471/MUM/2014[2010-11]Status: DisposedITAT Mumbai18 Oct 2016AY 2010-11

Bench: Shri Sanjay Garg & Shri Ashwani Tanejaassessment Year: 2010-11 Dinesh V. Bahirwani, Dcit 20(2), Unit No.605, Business Suites बनाम/ Mumbai- 9 Ploot No.83, Vs. S.V. Rd, Santacruz(W) Mumbai-400054 (Appellant) (Revenue) P.A. No. Abrpb3559K Assessment Year: 2010-11 Acit 24(2) Dinesh V. Bahirwani, 612, Piramal Chambers, Unit No.605, Business बनाम/ Lalbaug, Suites 9 Ploot No.83, Vs. Mumbai-400012 S.V. Rd, Santacruz(W) Mumbai-400054 (Respondent) (Revenue) P.A. No. Abrpb3559K Appellant By Shri Vipul Shah (Ar) Shri B.S. Bist (Sr. Dr) Revenue By सुनवाई क" तार"ख/Date Of Hearing : 18/10/2016 18/10/2016 आदेश क" तार"ख /Date Of Order: आदेश / O R D E R

Section 143(3)

…pted by the assessee results in underestimation of profits and is therefore rejected. Otherwise, the presumption would be that the entire exercise is revenue neutral." 5.1.4 In the decision rendered in the case of CIT v. Margadarsi Chit Funds (P.) Ltd. [1985] 155 ITR 442 (AP), it was held that the A.O. must refer to the inherent defect in the system and record a clear finding that the system of accounting followed by the assessee is such that correct profits cannot be deduced from the books of account maintained by the assessee. It is not open to the ITO to intervene and substitute a different system of accountin…

M/S. Mehta Construction Co., New Delhi vs. JCIT, New Delhi

In the result the appeals filed by the assessee i

ITA 474/DEL/2015[2010-11]Status: DisposedITAT Delhi16 Oct 2015AY 2010-11

Bench: Shri Inturi Rama Rao & Shri Sudhanshu Srivastavaassessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2Nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Assessment Year: 2010-11 Mehta Construction Co., Vs. Jcit, Circle-62(1), R-695, 2Nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Ita Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 Acit, Circle-38(1), Vs. Mehta Construction Co., New Delhi R-695, Iind Floor, Rajinder Nagar, New Delhi (Pan: Aahfm3503D) Appellant) (Respondent) Assessee By : Sh. Narender Chillar, Adv. Department By : Sh. P. Dam Kanunjna, Sr. Dr Date Of Hearing: 06.10.2015 Date Of Pronouncement: 16.10.2015 Order Per Inturi Rama Rao, A.M.: These Are The Appeals Filed By The Assessee-Company As Well As By The Revenue. The Appeals In Ita Nos. 3967/Del/2010 For A.Y. 2007-08 & 474/Del/2015 For A.Y. 2010-11 Are Filed By The Assessee Company. The Appeals

For Appellant: Sh. Narender Chillar, AdvFor Respondent: Sh. P. Dam Kanunjna, Sr. DR
Section 145Section 145(3)

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘E’: NEW DELHI BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Assessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And Assessment Year: 2010-11 Mehta Construction Co., Vs. JCIT, Circle-62(1), R-695, 2nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And ITA Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 ACIT, Circl…

ACIT, New Delhi vs. M/S Mehta Construction Co., New Delhi

In the result the appeals filed by the assessee i

ITA 4366/DEL/2012[2009-10]Status: DisposedITAT Delhi16 Oct 2015AY 2009-10

Bench: Shri Inturi Rama Rao & Shri Sudhanshu Srivastavaassessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2Nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Assessment Year: 2010-11 Mehta Construction Co., Vs. Jcit, Circle-62(1), R-695, 2Nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Ita Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 Acit, Circle-38(1), Vs. Mehta Construction Co., New Delhi R-695, Iind Floor, Rajinder Nagar, New Delhi (Pan: Aahfm3503D) Appellant) (Respondent) Assessee By : Sh. Narender Chillar, Adv. Department By : Sh. P. Dam Kanunjna, Sr. Dr Date Of Hearing: 06.10.2015 Date Of Pronouncement: 16.10.2015 Order Per Inturi Rama Rao, A.M.: These Are The Appeals Filed By The Assessee-Company As Well As By The Revenue. The Appeals In Ita Nos. 3967/Del/2010 For A.Y. 2007-08 & 474/Del/2015 For A.Y. 2010-11 Are Filed By The Assessee Company. The Appeals

For Appellant: Sh. Narender Chillar, AdvFor Respondent: Sh. P. Dam Kanunjna, Sr. DR
Section 145Section 145(3)

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘E’: NEW DELHI BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Assessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And Assessment Year: 2010-11 Mehta Construction Co., Vs. JCIT, Circle-62(1), R-695, 2nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And ITA Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 ACIT, Circl…

ACIT, New Delhi vs. M/S. Mehta Construction Co., New Delhi

In the result the appeals filed by the assessee i

ITA 2561/DEL/2012[2008-09]Status: DisposedITAT Delhi16 Oct 2015AY 2008-09

Bench: Shri Inturi Rama Rao & Shri Sudhanshu Srivastavaassessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2Nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Assessment Year: 2010-11 Mehta Construction Co., Vs. Jcit, Circle-62(1), R-695, 2Nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Ita Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 Acit, Circle-38(1), Vs. Mehta Construction Co., New Delhi R-695, Iind Floor, Rajinder Nagar, New Delhi (Pan: Aahfm3503D) Appellant) (Respondent) Assessee By : Sh. Narender Chillar, Adv. Department By : Sh. P. Dam Kanunjna, Sr. Dr Date Of Hearing: 06.10.2015 Date Of Pronouncement: 16.10.2015 Order Per Inturi Rama Rao, A.M.: These Are The Appeals Filed By The Assessee-Company As Well As By The Revenue. The Appeals In Ita Nos. 3967/Del/2010 For A.Y. 2007-08 & 474/Del/2015 For A.Y. 2010-11 Are Filed By The Assessee Company. The Appeals

For Appellant: Sh. Narender Chillar, AdvFor Respondent: Sh. P. Dam Kanunjna, Sr. DR
Section 145Section 145(3)

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘E’: NEW DELHI BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Assessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And Assessment Year: 2010-11 Mehta Construction Co., Vs. JCIT, Circle-62(1), R-695, 2nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And ITA Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 ACIT, Circl…

M/S. Mehta Construction Co., New Delhi vs. ITO, New Delhi

In the result the appeals filed by the assessee i

ITA 3967/DEL/2010[2007-08]Status: DisposedITAT Delhi16 Oct 2015AY 2007-08

Bench: Shri Inturi Rama Rao & Shri Sudhanshu Srivastavaassessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2Nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Assessment Year: 2010-11 Mehta Construction Co., Vs. Jcit, Circle-62(1), R-695, 2Nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (Pan: Aahfm3503D) (Appellant) (Respondent) & Ita Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 Acit, Circle-38(1), Vs. Mehta Construction Co., New Delhi R-695, Iind Floor, Rajinder Nagar, New Delhi (Pan: Aahfm3503D) Appellant) (Respondent) Assessee By : Sh. Narender Chillar, Adv. Department By : Sh. P. Dam Kanunjna, Sr. Dr Date Of Hearing: 06.10.2015 Date Of Pronouncement: 16.10.2015 Order Per Inturi Rama Rao, A.M.: These Are The Appeals Filed By The Assessee-Company As Well As By The Revenue. The Appeals In Ita Nos. 3967/Del/2010 For A.Y. 2007-08 & 474/Del/2015 For A.Y. 2010-11 Are Filed By The Assessee Company. The Appeals

For Appellant: Sh. Narender Chillar, AdvFor Respondent: Sh. P. Dam Kanunjna, Sr. DR
Section 145Section 145(3)

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘E’: NEW DELHI BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Assessment Year: 2007-08 Mehta Construction Co., Vs. Income Tax Officer, R-695, 2nd Floor, New Ward-38(2), New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And Assessment Year: 2010-11 Mehta Construction Co., Vs. JCIT, Circle-62(1), R-695, 2nd Floor, New Civic Centre, New Delhi Rajinder Nagar, New Delhi (PAN: AAHFM3503D) (Appellant) (Respondent) And ITA Nos. 2561 & 4366/Del/2012 Assessment Years: 2008-09 & 2009-10 ACIT, Circl…