CIT v. Reliance Utilities & Power Ltd.

313 ITR 340High Court2009#10 most cited

What is CIT v. Reliance Utilities & Power Ltd. authority for?

Where an assessee claims that investments were made out of own funds, interest disallowance under Section 14A read with Rule 8D may not apply if the assessee demonstrates the availability of sufficient interest-free funds to cover such investments.

2,118

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2013 to 2026.

Also referred to as

CIT v. Reliance Utilities and Power Ltd. · Section 14A · Rule 8D · interest free advances · disallowance of interest expenditure · own funds · interest-free funds

Also reported as

178 Taxmann 13513 DTR 237178 Taxmann.com 135284 CTR 414

Sections most often in play

Section 14ASection 36(1)(iii)Section 143(3)Section 115JBSection 8DSection 10(34)Section 143(2)Section 37(1)

Issues it is cited on

interest free advancesdisallowance of interest expendituresection 36(1)(iii)disallowance under section 14acommercial expediencydisallowance u/s 14asection 14abook profitssection 115jsection 36(1)section 36section 115jb

Judgments citing CIT v. Reliance Utilities & Power Ltd.

DCIT, C-V, Ludhiana vs. M/S Hero Cycles Ltd., Ludhiana

In the result, appeal of the Department is dismissed and the appeal of the assessee is allowed

ITA 588/CHANDI/2018[2012-13]Status: DisposedITAT Chandigarh08 Sept 2025AY 2012-13

Bench: SHRI. RAJPAL YADAV (Vice President), SHRI. KRINWANT SAHAY, AM आयकर अपील सं. / ITA No. 588/Chd/2018 निर्धारण वर्ष / Assessment Years : 2012-13 The DCIT C-V, Ludhiana बनाम M/s Hero Cycles Ltd. Hero Nagar, G.T. Road Ludhiana स्थायी लेखा सं./PAN NO: AAACH4073P अपीलार्थी/Appellant प्रत्यर्थी / Respondent आयकर अपील सं. / ITA No. 473/Chd/2018 निर्धारण वर्ष / Assessment Years : 2012-13 M/s Hero Cycles Ltd. Hero Nagar, G.T. Road Ludhiana बनाम The ACIT C-V, Ludhiana स्थायी लेखा सं./PAN NO: AAACH4073P

For Appellant: Shri Ashwani Kumar, Shri Ashish Aggarwal &For Respondent: Shri Manav Bansal, CIT, DR
Section 10(38)Section 143(1)Section 14ASection 36(1)(iii)

…ppellant were sufficient to cover the interest free advances made by it of Rs.10.29 crores to its sister company. We are entirely in agreement with the judgment of the Bombay High Court in Commissioner of Income Tax vs. Reliance Utilities & Power Ltd., (2009) 313 ITR 340, para-10, that if there are interest free funds available a presumption would arise that investment would be out of the interest free funds generated or available with the company if the interest free funds were sufficient to meet the investment.” 9. Therefore, in such circumstances, no disallowance under section 14A of the Act on account of inte…

M/S Hero Cycles Ltd., Ludhiana vs. ACIT, C-V, Ludhiana

ITA 473/CHANDI/2018[2012-13]Status: DisposedITAT Chandigarh08 Sept 2025AY 2012-13
For Respondent: Shri Ashwani Kumar, Shri Ashish Aggarwal &
Section 10(38)Section 143(1)Section 14ASection 36(1)(iii)

…ppellant were sufficient to cover the interest free advances made by it of Rs.10.29 crores to its sister company. We are entirely in agreement with the judgment of the Bombay High Court in Commissioner of Income Tax vs. Reliance Utilities & Power Ltd., (2009) 313 ITR 340, para-10, that if there are interest free funds available a presumption would arise that investment would be out of the interest free funds generated or available with the company if the interest free funds were sufficient to meet the investment." 9. Therefore, in such circumstances, no disallowance under section 14A of the Act on account of inte…

Gauge 16 Kitchen Equipments, Bangalore vs. Income Tax Officer Ward 5(2)(4), Bangalore

In the result, appeal of the assessee is allowed

ITA 1680/BANG/2024[2018-19]Status: DisposedITAT Bangalore08 Sept 2025AY 2018-19

Bench: Shri Prashant Maharishi & Shri Keshav Dubeyassessment Year : 2018-19

For Appellant: Sri Balram R Rao, A.RFor Respondent: Sri Balusamy N., D.R
Section 143(2)Section 143(3)Section 250

…bogus. Therefore, we do not find any reason to disbelief the genuineness of the purchases made by the assessee. Further, we also rely on the decision of Hon’ble High Court of Bombay in the case of PCIT Vs. Shapoorji Pallonji & Company Ltd. reported in (2020) 423 ITR 220 (Bom.), which has also been affirmed by the Apex Court in which it was held under- “18. Thus, we find that according to the Tribunal the assessing officer had merely relied upon information received from the Sales Tax Department, Government of Maharashtra without carrying out any independent enquiry. Tribunal had recorded a finding that assessin…

ACIT, Circle-33(1), New Delhi vs. Lucky Exports, New Delhi

Accordingly ground nos. 1 and 2 are dismissed

ITA 7113/DEL/2017[2012-13]Status: DisposedITAT Delhi27 Aug 2025AY 2012-13

Bench: Shri S. Rifaur Rahman & Shri Sudhir Pareek

For Appellant: Sh. P. Roy Chaudhuri, AdvFor Respondent: Ms. Suman Malik, CIT(DR)
Section 143(1)

…ectfully follow the decision of coordinate bench of ITAT Mumbai 'G' Bench in the case of M/s Aplab Limited vs ACIT (supra) wherein it was held as under.- "13. The Hon'ble jurisdictional High Court in the case of CIT vs. Reliance Utilities & Power Ltd. ((2009) 313 ITR 340 (Bom)) considered almost similar facts. In that case the AO recorded a finding that a sum of Rs.213 crores was invested by the assessee out of their own funds and Rs. 1.74 crores out of borrowed funds. Accordingly, disallowance of interest was made to the tune of Rs.2.40 crores. It was argued on behalf of the assessee that no 9 ITA Nos.-5502 & 7…

ACIT, Circle-33(1), New Delhi vs. Lucky Exports, New Delhi

Accordingly ground nos. 1 and 2 are dismissed

ITA 5502/DEL/2017[2011-12]Status: DisposedITAT Delhi27 Aug 2025AY 2011-12

Bench: Shri S. Rifaur Rahman & Shri Sudhir Pareek

For Appellant: Sh. P. Roy Chaudhuri, AdvFor Respondent: Ms. Suman Malik, CIT(DR)
Section 143(1)

…ectfully follow the decision of coordinate bench of ITAT Mumbai 'G' Bench in the case of M/s Aplab Limited vs ACIT (supra) wherein it was held as under.- "13. The Hon'ble jurisdictional High Court in the case of CIT vs. Reliance Utilities & Power Ltd. ((2009) 313 ITR 340 (Bom)) considered almost similar facts. In that case the AO recorded a finding that a sum of Rs.213 crores was invested by the assessee out of their own funds and Rs. 1.74 crores out of borrowed funds. Accordingly, disallowance of interest was made to the tune of Rs.2.40 crores. It was argued on behalf of the assessee that no 9 ITA Nos.-5502 & 7…

M/S. Maloo Constructions(India)Private Limited, Bengaluru vs. DCIT, Circle-4(1)(1), Bengaluru

ITA 2385/BANG/2024[2018-19]Status: DisposedITAT Bangalore26 Aug 2025AY 2018-19

Bench: Shri Laxmi Prasad Sahu & Shri Keshav Dubey

For Appellant: Sri V. Srinivasan, A.RFor Respondent: Sri Subramanian S., D.R
Section 132Section 143(2)Section 250

…& surmises, the ld. AO has disallowed only Rs.97,57,825/- alleging the same as bogus. Lastly, ld. A.R. of the assessee relied upon the decision of Hon'ble High Court of Bombay in the case of Principal CIT Vs. Shapoorji Pallonji and Co. Ltd. reported in (2020) 423 ITR 220 (Bom.) & submitted that entire addition is based on the information from third party agency without conducting any independent enquiry by the AO. 8. Ld. D.R. on the other hand relied on the order of the authorities below and vehemently submitted that the assessee had not submitted any report in its case which mention that the Commercial Tax depar…

G R N Finsec Private Limited, Mumbai vs. Assistant Commissioner of Income Tax, Mumbai

In the result, the appeal filed by the assessee in ITA No

ITA 5341/MUM/2024[2016-17]Status: DisposedITAT Mumbai26 Aug 2025AY 2016-17

Bench: Shri Vikram Singh Yadav & Shri Sandeep Gosain

For Appellant: Shri Madhur Agrawal &For Respondent: Shri Swapnil Choudhary
Section 143(3)Section 14ASection 36(1)Section 36(1)(iii)

…shares. In this regard, reliance was placed on the decision of the Hon‟ble Supreme Court in the case of CIT vs. Reliance Industries Ltd., 410 ITR 466(SC) as well as the decision of the Hon‟ble Bombay High Court in the case of CIT vs. Reliance Utilities Ltd., 313 ITR 340 (Bom). 8. Per contra, the Ld. DR is heard, who has relied on the order passed by the AO as well as that of the Ld.CIT(A). 9. We have heard the rival contentions and perused the material available on record. Firstly, it is noted that during the year under consideration, shares of Trishakti Power Private Limited have been issued and allotted to th…

G R N Finsec Private Limited, Mumbai vs. Deputy Commissioner of Income Tax - Circle 1(1)(2), Mumbai

In the result, the appeal filed by the assessee in ITA No

ITA 5329/MUM/2024[2015-16]Status: DisposedITAT Mumbai26 Aug 2025AY 2015-16

Bench: Shri Vikram Singh Yadav & Shri Sandeep Gosain

For Appellant: Shri Madhur Agrawal &For Respondent: Shri Swapnil Choudhary
Section 143(3)Section 14ASection 36(1)Section 36(1)(iii)

…shares. In this regard, reliance was placed on the decision of the Hon‟ble Supreme Court in the case of CIT vs. Reliance Industries Ltd., 410 ITR 466(SC) as well as the decision of the Hon‟ble Bombay High Court in the case of CIT vs. Reliance Utilities Ltd., 313 ITR 340 (Bom). 8. Per contra, the Ld. DR is heard, who has relied on the order passed by the AO as well as that of the Ld.CIT(A). 9. We have heard the rival contentions and perused the material available on record. Firstly, it is noted that during the year under consideration, shares of Trishakti Power Private Limited have been issued and allotted to th…

Addl CIT Ltu, Mumbai vs. Bajaj Holding & Investment Ltd ( Foremerly Known As Bajaj Auto Ltd), Mumbai

In the result, appeal filed by the revenue is dismissed and appeal filed by the assessee stands partly allowed as indicated hereinabove

ITA 5510/MUM/2012[2007-08]Status: DisposedITAT Mumbai26 Aug 2025AY 2007-08

Bench: Smt. Beena Pillai () & Shri Renu Jauhri ()

Section 14ASection 80

…iance on the decision of Hon’ble Bombay High Court in case of Godrej and Boyce Manufacturing company Ltd reported in (2010) 194 taxmann.com 203. He also placed reliance on Hon’ble Bombay High Court in case of CIT V. Reliance Utility and Power Ltd. reported in 313 ITR 340. 15.3. Without prejudice to the above, the Ld. Sr. Counsel submitted that, the disallowance if any could be restricted to 2% ITA No. 5510 & 5652/Mum/2012; 38 A.Y. 2007-08 Bajaj Holding & Investment Ltd. (Formerly Known as Bajaj Auto Ltd.) of the exempt income as has been made in the preceding assessment years being A.Y. 2004-05 to 2006-07. 15.4.…

Central Bank of India, Mumbai vs. Dy Comm of Income Tax 2(1) (1), Mumbai

ITA 1761/MUM/2022[2014-15]Status: DisposedITAT Mumbai22 Aug 2025AY 2014-15

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and comp…

DCIT Cir. 2(1)(2), Mumbai vs. M/S Central Bank of India, Mumbai

In the result, the appeal by the assessee for the

ITA 1279/MUM/2020[2016-17]Status: DisposedITAT Mumbai22 Aug 2025AY 2016-17

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and comp…

Central Bank of India, Mumbai vs. ACIT -2(1)(2), Mumba

ITA 1054/MUM/2020[2016-17]Status: DisposedITAT Mumbai22 Aug 2025AY 2016-17

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and com…

Central Bank of India, Mumbai vs. CIT(A)-3, Mumbai

In the result, the appeal by the Revenue for the

ITA 5346/MUM/2018[2013-14]Status: DisposedITAT Mumbai22 Aug 2025AY 2013-14

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and comp…

Jt. CIT (OSD) -2(1)(2), Mumbai vs. Central Bank of India, Mumbai

In the result, the appeal by the assessee for the

ITA 3674/MUM/2018[2013-14]Status: DisposedITAT Mumbai22 Aug 2025AY 2013-14

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and com…

DCIT 2(1)(1), Mumbai vs. Central Bank of India, Mumbai

In the result, the appeal by the assessee for the

ITA 1223/MUM/2018[2015-16]Status: DisposedITAT Mumbai22 Aug 2025AY 2015-16

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and comp…

Central Bank of India, Mumbai vs. ACIT - 2(1)(2), Mumbai

In the result, the appeal by the assessee for the

ITA 1078/MUM/2018[2015-16]Status: DisposedITAT Mumbai22 Aug 2025AY 2015-16

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and comp…

ACIT - 2(1)(2), Mumbai vs. Central Bank of India, Mumbai

ITA 5878/MUM/2017[2014-15]Status: DisposedITAT Mumbai22 Aug 2025AY 2014-15

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and com…

Central Bank of India, Mumbai vs. Deputy Commissioner of Income Tax 2(1)(2), Mumbai

ITA 5664/MUM/2017[2014-15]Status: DisposedITAT Mumbai22 Aug 2025AY 2014-15

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri R.A. Dhyani, CIT-DR
Section 10Section 115JSection 14ASection 250Section 37(1)

…and no interest was paid on current deposits, so interest is not attributable to earning tax-free income. In this regard, the assessee placed reliance upon the decision of the Hon'ble jurisdictional High Court in Reliance Utilities and Power Ltd, reported in 313 ITR 340 (Bom.). The assessee further submitted that since securities are held as stock in trade in the case of a bank, no disallowance should be made under section 14A read with Rule 8D of the Rules. 7. The Assessing Officer ("AO"), vide order dated 26/03/2015 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and comp…

M/S T vs. Motor Company Limited, Chennaivs.ACIT Corporate Circle 3 (1), Chennai

ITA 2405/CHNY/2019[2014-14]Status: DisposedITAT Chennai13 Aug 2025AY 2014-14

Bench: Shri Aby T Varkey & Shri Amitabh Shukla

Section 92C(2)

…Assessing Officer disallowing a part of interest payments under Section 14A of the Act (read with rule 8D(2)(ii) of I.T Rules, 1962) needs to be set aside". We note that Hon'ble Bombay High Court in the case of CIT v. Reliance Utilities and Power Ltd. (2009) 313 ITR 340 has laid the proposition of law that, when there are both interest free funds and interest bearing funds, the presumption is that interest free funds were utilized for interest free investment and advances. Thus, we note from the factual matrix discussed supra, that assessee had total own funds more than Rs 1121 crores and the total investment ma…

Raajratna Energy Holdings Private Limited, Hyderabad vs. Deputy Commissioner of Income Tax, Central Circle-2(2), Bangalore

ITA 1185/BANG/2025[2018-19]Status: DisposedITAT Bangalore11 Aug 2025AY 2018-19

Bench: Shri. Laxmi Prasad Sahu & Shri. Soundararajan K

For Appellant: Shri. Ramesh Babu, CAFor Respondent: Shri. Swaroop Manava, Addl. CIT(DR)(ITAT), Bangalore
Section 14ASection 56(2)Section 56(2)(viib)

…INCOME TAX APPELLATE TRIBUNAL "B" BENCH : BANGALORE BEFORE SHRI. LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI. SOUNDARARAJAN K, JUDICIAL MEMBER ITA Nos.1184, 1185/Bang/2025 Assessment Years : 2017-18, 2018-19 M/s Raajratna Energy Holdings Pvt. Vs. ITO, Ltd Plot No 304, Level 3, Surya Chakra House, Road No 78, Jubilee Hills, Hyderabad - 500033. PAN : AAECM 6049 G APPELLANT Ward -3(2)(3), Bangalore. RESPONDENT Assessee by : Shri. Ramesh Babu, CA Revenue by : Shri. Swaroop Manava, Addl. CIT(DR)(ITAT), Bangalore. Date of hearing : 07.08.2025 Date of Pronouncement: 11=.09.2025 ORDER Per Laxmi Prasad Sahu, Accountant…