CIT v. Shan Finance

231 ITR 308Supreme Court of India1998#1236 most cited

What is CIT v. Shan Finance authority for?

A financier owning machinery is entitled to investment allowance even if the machinery is used by its lessee for production purposes.

91

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2008 to 2025.

Also referred to as

CIT v. Shan Finance · 231 ITR 308 · Supreme Court · investment allowance · machinery · lessee · financier · production

Sections most often in play

Section 142(1)Section 143(3)Section 250Section 32Section 37(1)Section 92CA(3)

Issues it is cited on

section 28(va)section 41(4)depreciation on softwaresection 2(42a)section 43(6)(c)section 32anon-compete feesection 43(6)put to useblock of assetsopening wdvsection 41(1)

Judgments citing CIT v. Shan Finance

Brace Iron & Steel P.Ltd, New Delhi vs. Addl.CIT, Special Range-2, New Delhi

In the result, appeal of Assessee is allowed

ITA 8617/DEL/2019[2015-16]Status: DisposedITAT Delhi03 Aug 2021AY 2015-16

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

For Appellant: Shri Lakshya Budhira, C.AFor Respondent: Shri Satpal Gulati, CIT-DR

…use of the monies (as in a finance lease) or represents compensation 74 ITA.No.8617/Del./2019 M/s. Brace Iron & Steel Pvt. Ltd., New Delhi. for the use of the assets (as in an operational lease) • The judgment of the Supreme Court in Shaan Finance Pvt. Ltd. (231 ITR 308)(SC) relied on by the assessee is not applicable to the facts of the present case since that decision related to the claim of investment allowance and the business of the assessee was that of leasing only. The other decisions, particularly orders of the Tribunal relied on by the assessee were not applicable to the present case. • In Mcdowell case…

The Pr. Commissioner of Income Tax vs. M/S Cisco Systems

The appeals are allowed; the impugned

ITA/27/2019HC Karnataka18 Jun 2021

Bench: SATISH CHANDRA SHARMA,R. NATARAJ

Section 143(3)Section 144Section 260ASection 263Section 32

…ng the decision of the CIT (A) and the ITAT holding that the 28 assessee company is entitled to the investment allowance and additional depreciation. In this judgment of the Karnataka High Court the decision of the Supreme Court reported in 231 ITR 308 was relied upon. Therefore we have no hesitation to hold that the appellant- company is entitled to a higher rate of depreciation at 50% on the trucks leased out by it. We therefore, reverse the orders of the CIT (Appeals) on this issue.” 32. For the foregoing reasons, in our opinion, the High Court erred in law in reversing the decision o…

Ifci Ltd., New Delhi vs. DCIT, New Delhi

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

ITA 2982/DEL/2015[2010-11]Status: DisposedITAT Delhi08 Oct 2020AY 2010-11

Bench: Shri Bhavnesh Saini & Shri O.P. Kant

Section 115JSection 143(3)Section 14A

…eased assets. The Ld. CIT(A) following order of his predecessor in A.Y.- 2008-09, the direction of the Tribunal in assessment year 1995-96 and decision of the Hon’ble Supreme Court in the case 4 ITA No.2982/Del./2015 of CIT Vs Shann Finance Private Limited, 231 ITR 308(SC) & ICDS Ltd Vs CIT 350 ITR 527(SC), allowed the claim of the assessee, subject to verification by the Assessing Officer that lessee(s) have not claimed any depreciation on same assets. The direction of the Learned CIT(A) are reproduced as under: “8.5. It is observed that although the appellant has made submissions before the AO that lessees h…

DCIT, New Delhi vs. M/S Ifci Ltd., New Delhi

In the result, cross objection of the assessee is allowed and appeal of the learned assessing officer is dismissed

ITA 1359/DEL/2011[2002-03]Status: DisposedITAT Delhi31 Aug 2020AY 2002-03

Bench: Ms Suchitra Kamble & Shri Prashant Maharishi

Section 10Section 14Section 143Section 143(3)Section 147Section 35D

…ness and therefore assessee is not eligible for allowance of depreciation thereon. The learned CIT – A allowed the claim of the assessee relying on the decision of the honourable Page 9 of 29 Supreme Court in case of CIT versus Shaan finance private limited 231 ITR 308. Therefore, AO is in appeal. 19 The learned DR supported the order of the AO and submitted that identical issue has been argued in appeal of the assessee for assessment year 1999 – 2000 and 2000-2001. He reiterated the same argument. 20 The learned authorised representative vehemently supported the order of the learned CIT – A and reiterated his…

Ifci Limited, New Delhi vs. DCIT, New Delhi

In the result ITA number, 1200/del/2011 filed by the assessee for assessment year 1999 – 2000 is allowed

ITA 1201/DEL/2011[2000-01]Status: DisposedITAT Delhi31 Aug 2020AY 2000-01

Bench: Ms Suchitra Kamble & Shri Prashant Maharishi

Section 143(2)Section 143(3)

…been disallowed in earlier years, the depreciation of the Appellant was disallowed for AY 1999-2000. 6. On Appeal, The Ld. CIT(A) had however allowed the deduction vide order dated 12.6.2002 following the decision of the Supreme Court in Shaan Finance (P) Ltd 231 ITR 308 (SC)and the orders in earlier assessment years. 7. On appeal by the department (respondents) the Hon‘ble Income Tax Appellate Tribunal in its order dated 08.03.2006 had remanded the matter to the Ld.AO stating that the order of coordinate bench of ITAT for assessment years wherein the ITAT had decided the issue in favour of the assessee following…

Ifci Limited, New Delhi vs. DCIT, New Delhi

In the result ITA number, 1200/del/2011 filed by the assessee for assessment year 1999 – 2000 is allowed

ITA 1200/DEL/2011[1999-2000]Status: DisposedITAT Delhi31 Aug 2020AY 1999-2000

Bench: Ms Suchitra Kamble & Shri Prashant Maharishi

Section 143(2)Section 143(3)

…been disallowed in earlier years, the depreciation of the Appellant was disallowed for AY 1999-2000. 6. On Appeal, The Ld. CIT(A) had however allowed the deduction vide order dated 12.6.2002 following the decision of the Supreme Court in Shaan Finance (P) Ltd 231 ITR 308 (SC)and the orders in earlier assessment years. 7. On appeal by the department (respondents) the Hon‘ble Income Tax Appellate Tribunal in its order dated 08.03.2006 had remanded the matter to the Ld.AO stating that the order of coordinate bench of ITAT for assessment years wherein the ITAT had decided the issue in favour of the assessee following…

DCIT, New Delhi vs. M/S. Ifci, New Delhi

In the result, cross objection of the assessee is allowed and appeal of the learned assessing officer is dismissed

ITA 2934/DEL/2010[2002-03]Status: DisposedITAT Delhi31 Aug 2020AY 2002-03

Bench: Ms Suchitra Kamble & Shri Prashant Maharishi

Section 10Section 14Section 143Section 143(3)Section 147Section 35D

…ness and therefore assessee is not eligible for allowance of depreciation thereon. The learned CIT – A allowed the claim of the assessee relying on the decision of the honourable Page 9 of 29 Supreme Court in case of CIT versus Shaan finance private limited 231 ITR 308. Therefore, AO is in appeal. 19 The learned DR supported the order of the AO and submitted that identical issue has been argued in appeal of the assessee for assessment year 1999 – 2000 and 2000-2001. He reiterated the same argument. 20 The learned authorised representative vehemently supported the order of the learned CIT – A and reiterated his…

M/S Fastway Transmission (P) Ltd., Chandigarh vs. DCIT, CC-II, Chandigarh

In the result the captioned appeals of the assessee are

ITA 140/CHANDI/2019[2015-16]Status: DisposedITAT Chandigarh28 Apr 2020AY 2015-16

Bench: Shri N.K. Saini & Shri Sanjay Gargआयकर अपील सं./ Ita No.547/Chd/2017 "नधा"रण वष" / Assessment Year : 2013-14

For Appellant: Shri Ashwani Kumar, CAFor Respondent: Shri Chandrajit Singh, CIT (DR) on 4.12.2019
Section 250(6)

…lied upon by Ld. Counsel for the assessee to stress the point that when the ownership had not transferred to the lessee then the arrangement can not be said to be of a loan or finance. The judgements referred to are as under: 1. CIT vs Shaan Finance (P) Ltd. 231 ITR 308 (SC) 2. CIT vs. Maharashtra Apex Corporation 254 ITR 98(SC) 3. ICDS Ltd. Vs. CIT 350 ITR 527(SC) 4. Rajshree Roadways vs. Union of India [2003] 129taxman 663(Raj.) 5. PKF Finance Ltd. Vs CIT (Pb. & Hry) 6. CIT Vs Cosmo Films Ltd. (2011) 338ITR 226 7. CIT vs Punjab State Electricity Board (2010) 320 ITR 469 (PB & Hry.) 8. Bombay Dyeing & Mfg. Co.…

M/S Fastway Transmission (P) Ltd., Chandigarh vs. DCIT, CC-II, Chandigarh

In the result the captioned appeals of the assessee are

ITA 139/CHANDI/2019[2012-13]Status: DisposedITAT Chandigarh28 Apr 2020AY 2012-13

Bench: Shri N.K. Saini & Shri Sanjay Gargआयकर अपील सं./ Ita No.547/Chd/2017 "नधा"रण वष" / Assessment Year : 2013-14

For Appellant: Shri Ashwani Kumar, CAFor Respondent: Shri Chandrajit Singh, CIT (DR) on 4.12.2019
Section 250(6)

…lied upon by Ld. Counsel for the assessee to stress the point that when the ownership had not transferred to the lessee then the arrangement can not be said to be of a loan or finance. The judgements referred to are as under: 1. CIT vs Shaan Finance (P) Ltd. 231 ITR 308 (SC) 2. CIT vs. Maharashtra Apex Corporation 254 ITR 98(SC) 3. ICDS Ltd. Vs. CIT 350 ITR 527(SC) 4. Rajshree Roadways vs. Union of India [2003] 129taxman 663(Raj.) 5. PKF Finance Ltd. Vs CIT (Pb. & Hry) 6. CIT Vs Cosmo Films Ltd. (2011) 338ITR 226 7. CIT vs Punjab State Electricity Board (2010) 320 ITR 469 (PB & Hry.) 8. Bombay Dyeing & Mfg. Co.…

M/S Fastway Transmission (P) Ltd., Chandigarh vs. ACIT, Chandigarh

In the result the captioned appeals of the assessee are

ITA 547/CHANDI/2017[2013-14]Status: DisposedITAT Chandigarh28 Apr 2020AY 2013-14

Bench: Shri N.K. Saini & Shri Sanjay Gargआयकर अपील सं./ Ita No.547/Chd/2017 "नधा"रण वष" / Assessment Year : 2013-14

For Appellant: Shri Ashwani Kumar, CAFor Respondent: Shri Chandrajit Singh, CIT (DR) on 4.12.2019
Section 250(6)

…lied upon by Ld. Counsel for the assessee to stress the point that when the ownership had not transferred to the lessee then the arrangement can not be said to be of a loan or finance. The judgements referred to are as under: 1. CIT vs Shaan Finance (P) Ltd. 231 ITR 308 (SC) 2. CIT vs. Maharashtra Apex Corporation 254 ITR 98(SC) 3. ICDS Ltd. Vs. CIT 350 ITR 527(SC) 4. Rajshree Roadways vs. Union of India [2003] 129taxman 663(Raj.) 5. PKF Finance Ltd. Vs CIT (Pb. & Hry) 6. CIT Vs Cosmo Films Ltd. (2011) 338ITR 226 7. CIT vs Punjab State Electricity Board (2010) 320 ITR 469 (PB & Hry.) 8. Bombay Dyeing & Mfg. Co.…

ACIT, Circle-4(1)(2), Ahmedabad vs. M/S. Zaveri & Company Pvt. Ltd, Ahmedabad

In the result, both the appeals of the Revenue are dismissed

ITA 1194/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad12 Mar 2020AY 2013-14

Bench: Shri Rajpal Yadav, Vice- & Shri Waseem Ahmed

For Appellant: Shri Surendra kumar, CIT-DR and
Section 10ASection 143(2)Section 143(3)Section 2Section 263

…’ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon’ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting fiscal statute, court cannot proceed to make good the deficiencies if there be any. The court must interpret the statute as it stands, and in case of doubt, in a manner favourable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which for…

ACIT, Circle-4(1)(2), Ahmedabad vs. M/S. Zaveri & Company Pvt. Ltd, Ahmedabad

In the result, both the appeals of the Revenue are dismissed

ITA 1193/AHD/2018[2012-13]Status: DisposedITAT Ahmedabad12 Mar 2020AY 2012-13

Bench: Shri Rajpal Yadav, Vice- & Shri Waseem Ahmed

For Appellant: Shri Surendra kumar, CIT-DR and
Section 10ASection 143(2)Section 143(3)Section 2Section 263

…’ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon’ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting fiscal statute, court cannot proceed to make good the deficiencies if there be any. The court must interpret the statute as it stands, and in case of doubt, in a manner favourable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which for…

M/S. Zaveri & Co. Pvt. Ltd., Ahmedabad vs. The Deputy Commissioner of Income Tax, Circle-4(1)(2), Ahmedabad

In the result, both the appeals of the Revenue are dismissed

ITA 1081/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad12 Mar 2020AY 2013-14

Bench: Shri Rajpal Yadav, Vice- & Shri Waseem Ahmed

For Appellant: Shri Surendra kumar, CIT-DR and
Section 10ASection 143(2)Section 143(3)Section 2Section 263

…’ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon’ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting fiscal statute, court cannot proceed to make good the deficiencies if there be any. The court must interpret the statute as it stands, and in case of doubt, in a manner favourable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which for…

DCIT, New Delhi vs. M/S. Quippo Oil & Gas Infra Ltd., New Delhi

Appeal of the revenue is dismissed

ITA 5710/DEL/2014[2008-09]Status: DisposedITAT Delhi03 Apr 2019AY 2008-09

Bench: Shri R. K. Panda & Ms Suchitra Kamblequippo Oil & Gas Infra Ltd. Vs The Additional D-2, 5Th Floor, Southern Park, Commissioner Of Income Saket Place Tax, New Delhi Aaacq1278P Range-14 New Delhi (Appellant) (Respondent) Dcit Vs Quippo Oil & Gas Infra Ltd. Circle-14(1) D-2, 5Th Floor, Southern New Delhi Park, Saket Place New Delhi Aaacq1278P (Appellant) (Respondent)

Section 115JSection 143(3)Section 37Section 43B

…nsal Credits Ltd. & Ors (2003) 259 ITR 69 (Del) wherein it was held that it is the end user of the specified asset which is relevant for determining the rate of depreciation. Further, Hon'ble Apex Court in the case of CIT(A) vs. Shaan Finance Pvt. Ltd. (1992) 231 ITR 308 (SC) has observed that the owner is entitled to depreciation on the machinery which has been hired out. Similar view was given in the case of CIT(A) vs. First Leasing Co. of India Ltd. (1995) 216 ITR 455 (Mad) and CIT vs. M.G.F. (India) Ltd. (2006) 285 ITR 142 (Del). 19. We have heard both the parties and perused the material available on record…

M/S. Quippo Oil & Gas Infrastructure Ltd., Gurgaon vs. Addl.CIT, New Delhi

Appeal of the revenue is dismissed

ITA 5634/DEL/2014[2008-09]Status: DisposedITAT Delhi03 Apr 2019AY 2008-09

Bench: Shri R. K. Panda & Ms Suchitra Kamblequippo Oil & Gas Infra Ltd. Vs The Additional D-2, 5Th Floor, Southern Park, Commissioner Of Income Saket Place Tax, New Delhi Aaacq1278P Range-14 New Delhi (Appellant) (Respondent) Dcit Vs Quippo Oil & Gas Infra Ltd. Circle-14(1) D-2, 5Th Floor, Southern New Delhi Park, Saket Place New Delhi Aaacq1278P (Appellant) (Respondent)

Section 115JSection 143(3)Section 37Section 43B

…nsal Credits Ltd. & Ors (2003) 259 ITR 69 (Del) wherein it was held that it is the end user of the specified asset which is relevant for determining the rate of depreciation. Further, Hon'ble Apex Court in the case of CIT(A) vs. Shaan Finance Pvt. Ltd. (1992) 231 ITR 308 (SC) has observed that the owner is entitled to depreciation on the machinery which has been hired out. Similar view was given in the case of CIT(A) vs. First Leasing Co. of India Ltd. (1995) 216 ITR 455 (Mad) and CIT vs. M.G.F. (India) Ltd. (2006) 285 ITR 142 (Del). 19. We have heard both the parties and perused the material available on record…

DCIT, Circle - 6(1), Kolkata vs. M/S. Integrated Coal Mining Limited, Kolkata

Appeal is partly allowed in above terms

ITA 170/KOL/2018[2010-11]Status: DisposedITAT Kolkata15 Mar 2019AY 2010-11

Bench: Shri S.S.Godara & Dr. A.L. Sainiassessment Year :2010-11 Dcit, Circle-6(1), V/S. M/S Integrated Coal P-7, Chowringhee Mining Ltd., 6, Church Square, Kolkata-69 Lane, 1Ste Floor, Kolakta-700001 [Pan No.Aaaci 5584 L] .. अपीलाथ" /Appellant ""यथ"/Respondent Dr. P.K. Srihari, Cit-Dr अपीलाथ" क" ओर से/By Appellant Shri Diparun Mukherjee, Aca & ""यथ" क" ओर से/By Respondent Shri Alolk Goenka, Aca 15-01-2019 सुनवाई क" तार"ख/Date Of Hearing 15-03-2019 घोषणा क" तार"ख/Date Of Pronouncement

Section 139(1)Section 143(3)Section 43B

…as not there comes up, and it is, therefore, a production of coal. The Division Bench followed its own decision in the later case of Khalsa Bros v. CIT [1996] 217 ITR 185. Mr. Bajoria also relied on the interesting case of CIT vs. Shan Finance (P) Ltd. [1998] 231 ITR 308 where the Supreme Court opined that a financier owning machinery might still be entitled to investment allowance even if the machinery is actually used by its lessee for the purpose of production. Going on the language of sub-sections (1) and (2) of the said section the Supreme Court found, on an accurate assessment of the language (we say this w…

The DCIT, Circle-4(1)(2), Ahmedabad vs. M/S. Zaveri & Co. Ltd., Ahmedabad

In the result, the appeal of the revenue is dismissed

ITA 864/AHD/2017[2011-12]Status: DisposedITAT Ahmedabad04 Mar 2019AY 2011-12
Section 10ASection 115JSection 143(3)Section 14ASection 1O

…’ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon’ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting fiscal statute, court cannot proceed to make good the deficiencies if there be any. The court must interpret the statute as it stands, and in case of doubt, in a manner favourable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which for…

M/S. Zaveri & Co. Pvt. Ltd., Ahmedabad vs. The Deputy Commissioner of Income Tax, Circle-8, Ahmedabad

In the result, the appeal of the revenue is dismissed

ITA 630/AHD/2017[2011-12]Status: DisposedITAT Ahmedabad04 Mar 2019AY 2011-12
Section 10ASection 115JSection 143(3)Section 14ASection 1O

…’ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon’ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting fiscal statute, court cannot proceed to make good the deficiencies if there be any. The court must interpret the statute as it stands, and in case of doubt, in a manner favourable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which for…

The Dy. Commissioner of Income Tax, Circle-1(1)(1), Ahmedabad vs. M/S. Ausom Enterprise Ltd., Ahmedabad

In the result, the appeals of the Revenue are partly allowed

ITA 1520/AHD/2016[2012-13]Status: DisposedITAT Ahmedabad15 Oct 2018AY 2012-13

Bench: Shri Rajpal Yadav & Shri Waseem Ahmedआयकर अपील सं./ Ita No. 1519 & 1520/Ahd/2016 "नधा"रण वष"/Assessment Year: 2010-11 & 2012-13 & आयकर अपील सं./ Ita No. 857/Ahd/2017 "नधा"रण वष"/Assessment Year: 2013-14

For Appellant: Shri M.K. Patel, ARFor Respondent: Shri S.K. Dev, Sr.DR
Section 10ASection 143(2)

…'ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon'ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting statute, court cannot proceed to make good the deficiencies if there be any. The court interpret the statute as it stands, and in case of doubt, in a manner favorable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which forms part of th…

The Dy. Commissioner of Income Tax, Circle-1(1)(1), Ahmedabad vs. M/S. Ausom Enterprise Ltd., Ahmedabad

In the result, the appeals of the Revenue are partly allowed

ITA 1519/AHD/2016[2011-12]Status: DisposedITAT Ahmedabad15 Oct 2018AY 2011-12

Bench: Shri Rajpal Yadav & Shri Waseem Ahmedआयकर अपील सं./ Ita No. 1519 & 1520/Ahd/2016 "नधा"रण वष"/Assessment Year: 2010-11 & 2012-13 & आयकर अपील सं./ Ita No. 857/Ahd/2017 "नधा"रण वष"/Assessment Year: 2013-14

For Appellant: Shri M.K. Patel, ARFor Respondent: Shri S.K. Dev, Sr.DR
Section 10ASection 143(2)

…'ble Supreme Court in the case of Sm. Tarulata Shyam Vs. CIT (1971) 108 ITR 345 (SC) held that there is no scope for importing in the statute words which are not there. Further, Hon'ble Supreme Court in the case of CIT Vs. Shann Finance Private Limited (1998) 231 ITR 308 (SC) went on to hold that in interpreting statute, court cannot proceed to make good the deficiencies if there be any. The court interpret the statute as it stands, and in case of doubt, in a manner favorable to taxpayer. Thus, we find no provision in the statute on the basis of which it can be held that the interest income which forms part of th…