CIT v. Shoorji Vallabhdas & Co.

46 ITR 144Supreme Court of India1962#114 most cited

What is CIT v. Shoorji Vallabhdas & Co. authority for?

Income tax is levied only on real income that actually materializes, not on hypothetical or notional income, even if accounting entries suggest otherwise. If no income results, there is no tax liability.

551

judgments rely on this decision, according to BharatTax’s citation analysis of 367,181 Indian tax judgments — from 2010 to 2026.

Also referred to as

CIT v. Shoorji Vallabhdas & Co. · 46 ITR 144 · real income theory · notional income · hypothetical income · income tax levy · accrual of income · receipt of income · Section 48 · Income Tax Act 1961

Sections most often in play

Section 143(3)Section 147Section 148Section 37(1)Section 115JBSection 153ASection 1961Section 14A

Issues it is cited on

real income theoryright to receivemercantile system of accountingsection 48section 45section 35section 28loose papersliable to taxsection 145capital expendituresection 37(1)

Judgments citing CIT v. Shoorji Vallabhdas & Co.

M/S Saregama India Limited, Kolkata vs. DCIT, Cir.-3(1), Kolkata

ITA 309/KOL/2017[2003-04]Status: DisposedITAT Kolkata29 Jan 2020AY 2003-04

Bench: Shri S.S.Godara & Dr. A.L. Saini

Section 143(3)

…he accounting system regularly maintained by the assessee and that was done by the appellant in the present case. The attention of the learned CIT(Appeals) is drawn to the decision of the Hon'ble Supreme Court in the case of CIT vs Shoorji Vallabhdas and Co. [46 ITR 144, 148 (SC.)], wherein It has been held that- "Income - tax is a levy on income. Though the Income-tax Act takes into account two points of time at which the liability to tax is attracted, viz.., the accrual of the income or its receipt, yet the substance of the matter is the income. If income does not result at all, there cannot be a tax, even thou…

Neelu Analjit Singh, New Delhi vs. Addl.CIT, Special Range-9, New Delhi

In the result, appeal filed by the assessee is partly allowed with above directions

ITA 2172/DEL/2018[2014-15]Status: DisposedITAT Delhi19 Dec 2019AY 2014-15

Bench: Shri H. S. Sidhu & Shri Prashant Maharishimrs. Neelu Analjit Singh, Vs. The Addl. Commissioner Of 15, Dr. Apj Abdul Kalam Road, Income Tax , New Delhi Special Range-9, Pan: Aatps06882D New Delhi (Appellant) (Respondent)

For Appellant: Shri Deepak Chopra, AdvFor Respondent: Mr. Zoheb Hussain, Senior
Section 2Section 45

…right to receive the income and there is corresponding debt owed to him by somebody. The concept of accrual of income have been well-settled by the Hon'ble Supreme Court in the case of E.D. Sasoon & Co. Ltd. (supra) and CIT v. Shoorjee Vallabhdas & Co. [1962] 46 ITR 144 (SC). The principle as discussed in these judgments have been upheld and reiterated time and again by the Hon'ble Supreme Court in catena of decisions including that of Excel industries (supra) and Balbir Singh Maini (supra) as relied upon by Mr. Ajay Vohra. There cannot be any iota of doubt that the word "accrued" in section 48 means there has to…

M/S Best Bakery & Ice Cream Parlour, Angamally vs. ACIT, Ernakulam

In the result, the appeals of the assessee in ITA Nos

ITA 513/COCH/2010[2007-08]Status: DisposedITAT Cochin16 Dec 2019AY 2007-08

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

M/S Best Bakery & Ice Cream Parlour, Angamally vs. ACIT, Ernakulam

In the result, the appeals of the assessee in ITA Nos

ITA 509/COCH/2010[2003-04]Status: DisposedITAT Cochin16 Dec 2019AY 2003-04

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

M/S Best Bakery & Ice Cream Parlour, Angamally vs. ACIT, Ernakulam

In the result, the appeals of the assessee in ITA Nos

ITA 507/COCH/2010[2001-02]Status: DisposedITAT Cochin16 Dec 2019AY 2001-02

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

M/S. Matha Enterprises, Angamally vs. ACIT, Ernakulam

In the result, the appeals of the assessee in ITA Nos

ITA 308/COCH/2010[2007-08]Status: DisposedITAT Cochin16 Dec 2019AY 2007-08

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

M/S. Matha Enterprises, Angamally vs. ACIT, Ernakulam

In the result, the appeals of the assessee in ITA Nos

ITA 304/COCH/2010[2003-04]Status: DisposedITAT Cochin16 Dec 2019AY 2003-04

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

M/S. Matha Enterprises, Angamally vs. ACIT, Ernakulam

In the result, the appeals of the assessee in ITA Nos

ITA 303/COCH/2010[2002-03]Status: DisposedITAT Cochin16 Dec 2019AY 2002-03

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

DCIT, Ernakulam vs. Matha Enterprises, Angamally

In the result, the appeals of the assessee in ITA Nos

ITA 269/COCH/2010[2001-02]Status: DisposedITAT Cochin16 Dec 2019AY 2001-02

Bench: Shri Chandra Poojari, Am &Shri George George K, Jm

For Respondent: Sri. Sudhanshu Shekhar Jha, CIT(DR)

…ee out of such unaccounted business activity as held by various courts from time to time and in the following judicial pronouncements relied upon by the assessee: d) Sanjeev Woolen Mills vs. CIT (2005) 279 ITR 102(SC) e) CTT v.Shoorji Vallabhdas and Co.(1962) 46 ITR 144(SC) f) CIT v. Kerala Financial Corpn. Ltd. (1985) 155 TTR 246(Ker.) 9.7 The CIT(A) observed that though Assessing officer had attempted to compute income by applying multiplication formulae on the basis of seized documents indicting undisclosed turnover in some period relevant to AY 2003-04 and 2007-08, the Assessing officer had not brought on re…

M/S Jindal Dyechem Industries Pvt. Ltd., New Delhi vs. Addl. CIT, New Delhi

In the result, ITA No.3253/Del/2011 filed by the Revenue is dismissed and ITA No

ITA 2242/DEL/2011[2005-06]Status: DisposedITAT Delhi13 Dec 2019AY 2005-06
For Appellant: Shri Salil Aggarwal, Advocate &
Section 69ASection 92Section 92C

…as wholly unsustainable since it brings to tax an income which has neither accrued to the appellant company and, nor received by the appellant company and, is thus, contrary to judgment in the case of CIT vs. Messrs. Shoorji Vallabhdas And Company reported in 46 ITR 144 (SC). 1.4 That the learned Commissioner of Income Tax (Appeals) has further erred both in law and on facts in confirming the aforesaid addition in disregard of the following submissions made by the appellant company: a) That mere advance of interest free loan does not constitute to international transaction u/s 92B of the Act. The expression “lend…

M/S. Religare Securities Ltd., New Delhi vs. ACIT, New Delhi

The appeal of the assessee stands allowed in terms of our directions contained in the preceding

ITA 2282/DEL/2013[2008-09]Status: DisposedITAT Delhi13 Dec 2019AY 2008-09

Bench: Shri N.K. Billaiya & Shri Sudhanshu Srivastavaasstt. Year: 2008-09

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Smt. Sulekha Verma, CIT(DR)
Section 143(1)Section 14ASection 28Section 36Section 36(1)(ii)Section 37(1)

…INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “F”: NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Asstt. Year: 2008-09 M/s. Religare Securities Ltd., Vs. ACIT D3, P3B, District Centre, Saket Circle-15(1), New Delhi. New Delhi. (Appellant) (Respondent) Assessee by: Shri Rohit Jain, Advocate Ms. Tejasvi Jain, Advocate Ms. Somya Jain, CA Department by : Smt. Sulekha Verma, CIT(DR) Date of Hearing 18/09/2019 Date of 13/12/2019 pronouncement O R D E R PER SUDHANSHU SRIVASTAVA, JM: This appeal by the assessee pertains to assessment year 2008-09 and challenges…

DCIT, New Delhi vs. M/S Jindal Dyechem Industries Pvt. Ltd., New Delhi

In the result, ITA No.3253/Del/2011 filed by the Revenue is dismissed and ITA No

ITA 3253/DEL/2011[2005-06]Status: DisposedITAT Delhi13 Dec 2019AY 2005-06
For Appellant: Shri Salil Aggarwal, Advocate &
Section 69ASection 92Section 92C

…as wholly unsustainable since it brings to tax an income which has neither accrued to the appellant company and, nor received by the appellant company and, is thus, contrary to judgment in the case of CIT vs. Messrs. Shoorji Vallabhdas And Company reported in 46 ITR 144 (SC). 1.4 That the learned Commissioner of Income Tax (Appeals) has further erred both in law and on facts in confirming the aforesaid addition in disregard of the following submissions made by the appellant company: a) That mere advance of interest free loan does not constitute to international transaction u/s 92B of the Act. The expression “lend…

DCIT Corporate Circle 2(1), Chennai vs. The India Cements Ltd., Chennai

In the result, the appeal of the Revenue in I

ITA 2416/CHNY/2019[2016-17]Status: DisposedITAT Chennai12 Dec 2019AY 2016-17

Bench: Shri George Mathan & Shri S. Jayaraman

For Respondent: Mr. Saroj Kumar, Advocate

…particular item as a profit or loss in the accounting year, but whether the said item could be regarded either as a profit or loss under the provision of the Act. The Supreme Court has also taken a similar view in the case of CIT v. Shoorji Vallabhdas & Co. (46 ITR 144), wherein it was held as under : “Income-tax is a levy on income. Though the Income-tax Act takes into account two points of time at which the liability to tax is attracted, viz., the accrual of the income or its receipt, yet the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in book-kee…

DCIT Corporate Circle 2(1), Chennai vs. The India Cements Ltd., Chennai

In the result, the appeal of the Revenue in I

ITA 2415/CHNY/2019[2015-16]Status: DisposedITAT Chennai12 Dec 2019AY 2015-16

Bench: Shri George Mathan & Shri S. Jayaraman

For Respondent: Mr. Saroj Kumar, Advocate

…particular item as a profit or loss in the accounting year, but whether the said item could be regarded either as a profit or loss under the provision of the Act. The Supreme Court has also taken a similar view in the case of CIT v. Shoorji Vallabhdas & Co. (46 ITR 144), wherein it was held as under : “Income-tax is a levy on income. Though the Income-tax Act takes into account two points of time at which the liability to tax is attracted, viz., the accrual of the income or its receipt, yet the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in book-kee…

DCIT Corporate Circle 2(1), Chennai vs. The India Cements Ltd., Chennai

In the result, the appeal of the Revenue in I

ITA 2414/CHNY/2019[2014-15]Status: DisposedITAT Chennai12 Dec 2019AY 2014-15

Bench: Shri George Mathan & Shri S. Jayaraman

For Respondent: Mr. Saroj Kumar, Advocate

…particular item as a profit or loss in the accounting year, but whether the said item could be regarded either as a profit or loss under the provision of the Act. The Supreme Court has also taken a similar view in the case of CIT v. Shoorji Vallabhdas & Co. (46 ITR 144), wherein it was held as under : “Income-tax is a levy on income. Though the Income-tax Act takes into account two points of time at which the liability to tax is attracted, viz., the accrual of the income or its receipt, yet the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in book-kee…

DCIT Corporate Circle 2(1), Chennai vs. The India Cements Ltd., Chennai

In the result, the appeal of the Revenue in I

ITA 2413/CHNY/2019[2012-13]Status: DisposedITAT Chennai12 Dec 2019AY 2012-13

Bench: Shri George Mathan & Shri S. Jayaraman

For Respondent: Mr. Saroj Kumar, Advocate

…particular item as a profit or loss in the accounting year, but whether the said item could be regarded either as a profit or loss under the provision of the Act. The Supreme Court has also taken a similar view in the case of CIT v. Shoorji Vallabhdas & Co. (46 ITR 144), wherein it was held as under : “Income-tax is a levy on income. Though the Income-tax Act takes into account two points of time at which the liability to tax is attracted, viz., the accrual of the income or its receipt, yet the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in book-kee…

DCIT Corporate Circle 2(1), Chennai vs. The India Cements Ltd., Chennai

In the result, the appeal of the Revenue in I

ITA 2412/CHNY/2019[2011-12]Status: DisposedITAT Chennai12 Dec 2019AY 2011-12

Bench: Shri George Mathan & Shri S. Jayaraman

For Respondent: Mr. Saroj Kumar, Advocate

…particular item as a profit or loss in the accounting year, but whether the said item could be regarded either as a profit or loss under the provision of the Act. The Supreme Court has also taken a similar view in the case of CIT v. Shoorji Vallabhdas & Co. (46 ITR 144), wherein it was held as under : “Income-tax is a levy on income. Though the Income-tax Act takes into account two points of time at which the liability to tax is attracted, viz., the accrual of the income or its receipt, yet the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in book-kee…

S N Builders & Developers, Bangalore vs. The Assistant Commissioner of Income Tax Circle-4(3)(1), Bangalore

In the result, the appeal filed by the assessee- company is allowed

ITA 106/BANG/2019[2014-15]Status: DisposedITAT Bangalore27 Nov 2019AY 2014-15

Bench: Shri B.R. Baskaran & Shri Pavan Kumar Gadalem/S. S.N.Builders & Developers, No.4, 2Nd Floor, Elephant Rock Road, Above Kalayan Jewellers, Jayanagar 3Rd Block, Bengaluru-560 011. Pan: Abefs 8850 P … Appellant Vs. Asst. Commissioner Of Income-Tax, Circle 4(3)(1), Bengaluru. … Respondent Appellant By : Smt. Suman Lunkar, Ca. Respondent By : Shri Pradeep Kumar, Cit(Dr) Date Of Hearing: 07/11/2019 Date Of Pronouncement: 27/11/2019 O R D E R Per Pavan Kumar Gadale, Jm : The Assessee Has Filed Appeal Against The Order Of The Cit(A), Bangalore-9, Bangalore, Passed U/S 143(3) & 250 Of The Income-Tax Act,1961 ['The Act' For Short].

For Appellant: Smt. Suman Lunkar, CAFor Respondent: Shri Pradeep Kumar, CIT(DR)
Section 143(2)Section 143(3)Section 234ASection 40Section 80Section 80I

…year goes to show that there was no income accrued. Mere entries in the books of accounts does not establish the accrual of income in the hands of the payee as Page 12 of 14 held by the Hon’ble Supreme Court in the case of CIT Vs M/s Shoorji Vallabhdas & Co. 46 ITR 144 wherein it was held as follows; “ That the subsequent agreement had altered the rate of commission in such a way as to make the income which really accrued to the assessee different from what had been entered in the books of account. This was nota case of a gift by the assessee to the managed companies of a portion of income which had already accr…

DCIT, Circle - 1(1), Kolkata vs. M/S. Mcnally Bharat Engineering Company Limited, Kolkata

ITA 147/KOL/2018[2010-11]Status: DisposedITAT Kolkata22 Nov 2019AY 2010-11

Bench: Shri S. S. Godara, Jm & Dr. A. L. Saini, Am I.T.A Nos. 147&109 & C.O Nos.35 & 36/Kol/2018 ("नधा"रण वष" / Assessment Years: 2010-11 & 2011-12) Dcit, Circle-1(1), Kolkata Vs. M/S. Mcnally Bharat Engineering Ltd. M/S Mcnally Bharat Engineering Co. Company Limited, 4, Mangoe Lane, Kolkata – 700001. "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aabcm9443R (Appellant) .. (Respondent/Cross-Objector)

For Appellant: Dr. P. K. Srihari, CIT(DR)For Respondent: Shri Chetan Mehta, FCA, Ashish Jain, FCA &
Section 115JSection 144C(3)Section 92B

…e books of accounts. In this regard the ITA No.100/Kol/2011& C.O.No.13/Kol/2011 532&217,533&218/Kol/2012 M/s. Mcnally Bharat Engg.Co.Ltd A.Yr.2006-07 CIT(A) placed reliance on the decision of the Hon'ble Supreme Court in the case of Shoorji Vallabhdas and Co. 46 ITR 144 (SC). 33. With regard to including the retention money in computing the book profits the CIT(A) held as follows :- "11.9 Whether the above amount needs to be excluded in computing Book Profit u/s 115JB or not, the above issue is only academic as once it is upheld that the income has not accrued to the assessee, the M/s. Mcnally Bharat Engineering…

DCIT, Circle - 1(1), Kolkata vs. M/S. Mcnally Bharat Engineering Company Limited, Kolkata

ITA 109/KOL/2018[2011-12]Status: DisposedITAT Kolkata22 Nov 2019AY 2011-12

Bench: Shri S. S. Godara, Jm & Dr. A. L. Saini, Am I.T.A Nos. 147&109 & C.O Nos.35 & 36/Kol/2018 ("नधा"रण वष" / Assessment Years: 2010-11 & 2011-12) Dcit, Circle-1(1), Kolkata Vs. M/S. Mcnally Bharat Engineering Ltd. M/S Mcnally Bharat Engineering Co. Company Limited, 4, Mangoe Lane, Kolkata – 700001. "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aabcm9443R (Appellant) .. (Respondent/Cross-Objector)

For Appellant: Dr. P. K. Srihari, CIT(DR)For Respondent: Shri Chetan Mehta, FCA, Ashish Jain, FCA &
Section 115JSection 144C(3)Section 92B

…e books of accounts. In this regard the ITA No.100/Kol/2011& C.O.No.13/Kol/2011 532&217,533&218/Kol/2012 M/s. Mcnally Bharat Engg.Co.Ltd A.Yr.2006-07 CIT(A) placed reliance on the decision of the Hon'ble Supreme Court in the case of Shoorji Vallabhdas and Co. 46 ITR 144 (SC). 33. With regard to including the retention money in computing the book profits the CIT(A) held as follows :- "11.9 Whether the above amount needs to be excluded in computing Book Profit u/s 115JB or not, the above issue is only academic as once it is upheld that the income has not accrued to the assessee, the M/s. Mcnally Bharat Engineering…