CIT v. Shantilal (P.) Ltd.

DCIT, CC- 8(1), Mumbai vs. Nirshilp Securities Pvt. Ltd., Mumbai

In the result, the appeal of the revenue in ITA No

…nd sale contracts, then there cannot be any speculative transaction, as per the provisions of section 43(5) of the Act. For this proposition, he relies on the decision of Supreme Court in the case of Commissioner of Income-tax v. Shantilal (P) Ltd reported in 144 ITR 57 (SC), wherein it was observed that a contract can be settled if, instead of effecting the delivery or transfer of the commodity envisaged by the contract, the promisee, in terms of section 63 of the Contract Act, accepts instead of it any satisfaction which he thinks fit. Where, instead of such performance or acceptance, the parties raise a disput…

DCIT 5(2), Mumbai vs. London Star Diamond Co. India P.Ltd, Mumbai

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

Bench: Shri Mahavir Singh & Shri Ramit Kocharआयकर अपील सं./I.T.A. No. 1359/Mum/2014 ("नधा"रण वष" / Assessment Year : 2010-11) The Deputy Commissioner Of London Star Diamond बनाम/ Income Tax 5(2) Company (India) Private V. Room No. 571, Aayakar Limited Bhawan, M K Road, Mumbai- 1610/1611 , 400 020 Prasad Chambers, Opera House, Mumbai-400 004 "थायी लेखा सं./Pan : Aaacl0576B .. (अपीलाथ" /Appellant) (""यथ" / Respondent)

…constitutes a payment of damages for such breach of contracts, which again allowable as business loss and not as speculation loss. In this regard, Ld Counsel relied on the judgment of the Hon'ble Supreme Court in the case of CIT v. Shantilal (P.) Ltd. [1983] 144 ITR 57/14 Taxman 1 and the one reported in 207 ITR 198. 13. Distinguishing the decision in the case of S. Vinodkumar Diamonds Pvt. Ltd: Bringing our attention to the decision of the ITAT, Mumbai in the case of S. Vinodkumar Diamonds (P.) Ltd v. Addl. CIT [2013] 59 SOT 124/35 taxmann.com 337 (Mum. - Trib.), Ld Counsel distinguished by stating that the los…

Asst CIT 25(2), Mumbai vs. Ratansingh Rathord, Mumbai

In the result, both appeals filed by the Revenue, i

Bench: Shri Shailendra Kumar Yadav, Jm & Shri Rajesh Kumar, Am

…of CIT Vs. Grand Cashew Corporation, 182 ITR 216 held that the liability to pay damages on account of breach of contract is an allowable deduction u/s 37(1) of the Act. Similar view has been taken by Hon'ble Apex Court in the case of CIT Vs Shantilal P. Ltd. 144 ITR 57, wherein it was held that any amount incurred by the assessee on account of non-fulfillment of business contract for reasons beyond his control is incidental to the business and is an allowable deduction. 11.1 Since the issue was covered by the order of the ITAT in assessee’s own case in A.Y. 2008-09 and the facts being same, for same reasoning…

Asst CIT 25(2), Mumbai vs. Ratansingh M, .Rathod, Mumbai

In the result, both appeals filed by the Revenue, i

Bench: Shri Shailendra Kumar Yadav, Jm & Shri Rajesh Kumar, Am

…of CIT Vs. Grand Cashew Corporation, 182 ITR 216 held that the liability to pay damages on account of breach of contract is an allowable deduction u/s 37(1) of the Act. Similar view has been taken by Hon'ble Apex Court in the case of CIT Vs Shantilal P. Ltd. 144 ITR 57, wherein it was held that any amount incurred by the assessee on account of non-fulfillment of business contract for reasons beyond his control is incidental to the business and is an allowable deduction. 11.1 Since the issue was covered by the order of the ITAT in assessee’s own case in A.Y. 2008-09 and the facts being same, for same reasoning…