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.

How many judgments cite CIT v. Shoorji Vallabhdas & Co.?

551 judgments on BharatTax cite CIT v. Shoorji Vallabhdas & Co. (46 ITR 144), spanning 2010 to 2026.

Which sections of the Income Tax Act does CIT v. Shoorji Vallabhdas & Co. come up under?

It is most often cited in judgments turning on Section 143(3), Section 147, Section 148, Section 37(1), Section 115JB, Section 153A.

CIT v. Shoorji Vallabhdas & Co. (46 ITR 144)

JCIT(OSD) Central Circle 1, Jhandewalan vs. Sahara India Real Estate Corporation Ltd., Lucknow

ITA 1085/DEL/2024[2017-18]Status: DisposedITAT Delhi07 Oct 2025AY 2017-18

Bench: Sh. Satbeer Singh Godara & Sh. S. Rifaur Rahman

For Appellant: Sh. Ajay Vohra, Sr. Adv. &For Respondent: Sh. Mahesh Kumar, CIT-DR

Section 143(3)

…re of notional interest cannot be brought to tax. The income-tax is chargeable or payable on the Real income. The income tax is not payable on any income which one could have been earned but has not been earned. In the case of CIT Vs. Shoorjl Vailabhdas & CO. 46 ITR 144 (SC), the apex court on the concept of real income held as under:- "Income Tax is a levy on income. No doubt, the Income Tax Act takes into account two points of time at which the ¡¡ability to tax is attracted, viz., the accrual of the income or its receipt; but the substance of the matter is the income. If income does not result at all, there can…

Om Prakash Gupta, Sawai Madhopur vs. DCIT Central Circle -1, Jaipur

The appeals of the assessee are disposed off as under :

ITA 399/JPR/2025[2017-18]Status: DisposedITAT Jaipur18 Sept 2025AY 2017-18

For Appellant: Shri Tarun Mittal, CA &For Respondent: Shri Rajesh Ojha, CIT-DR &

Section 115BSection 153ASection 69

…rein the Apex Court has given certain principles for taxing the income which we would like to reiterate herein below : 17. First of all, it is now well settled that income tax cannot be levied on hypothetical income. In CIT v. Shoorji Vallabhdas & Co. [1962] 46 ITR 144 (SC) it was held as follows:— "Income-tax is a levy on income. No doubt, 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; but 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…

Devi Dayal, Kaithal vs. Income Tax Officer, Ward-1, Kaithal

In the result, appeal is allowed

ITA 899/CHANDI/2024[2008-09]Status: DisposedITAT Chandigarh08 Sept 2025AY 2008-09

Bench: Shri Rajpal Yadav & Shri Krinwant Sahayआयकर अपील सं./ Ita No. 899/Chd/2024 "नधा"रण वष" / Assessment Year: 2008-09 Shri Devi Dayal, Vs The Ito, Pundri Anaj Mandi, Ward – 1, Kaithal-Haryana 136026. Kaithal. "थायी लेखा सं./Pan No: Aajpd5851H अपीलाथ"/Appellant ""यथ"/Respondent Assessee By : Shri Parikshit Aggarwal, Ca & Ms. Shruti Khandelwal, Advocate Revenue By : Shri Manav Bansal, Cit, Dr Date Of Hearing : 30.07.2025 Date Of Pronouncement : 08.09.2025

For Appellant: Shri Parikshit Aggarwal, CA and Ms. Shruti Khandelwal, AdvocateFor Respondent: Shri Manav Bansal, CIT, DR

Section 249Section 253Section 3Section 5

…463-464 referred to various judgments on the expression "accrues", and then held: '14. First of all, it is now well settled that income tax cannot be levied on hypothetical income. In CITv. Shoorji Vallabhdas and Co. [CITv. Shoorji Vallabhdas and Co., (1962) 46 ITR 144 ( S O ] it was held as follows: (ITR p. 148) "... Income tax is a levy on income. No doubt, 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; but the substance of the matter is the income. If income does not result at all, there cannot be a tax, even…

Kalaben Uttamchand Jain, Mumbai vs. Income Tax Officer Ward 24(2)(3), Mumbai

In the result the appeal filed by the assessee stands allowed

ITA 2954/MUM/2025[2012-13]Status: DisposedITAT Mumbai29 Aug 2025AY 2012-13

Bench: Smt. Beena Pillai () I.T.A. No.2954/Mum/2025 Assessment Year: 2012-13

Section 143(2)Section 148

…y written evidence, making it untenable in law. Moreover, Form 26AS reflects the full interest credited, indicating that the lender himself recognized the income and deducted TDS accordingly. The Hon'ble Supreme Court in CIT v. Shoorji Vallabhdas& Co. [(1962) 46 ITR 144 (SC)] has held that mere postponement or non-receipt of an income does not negate its taxability under the accrual system unless the right to receive it is legally surrendered. Since the appellant has failed to furnish credible evidence that the interest was waived and since the mercantile system requires accrual-based taxation, the addition made…

ITO-41(3)(2), Mumbai vs. K S Chamankar Enterprises, Malad (E), Mumbai

In the result, appeal of the Revenue is dismissed

ITA 4586/MUM/2024[2012-13]Status: DisposedITAT Mumbai19 Aug 2025AY 2012-13

Bench: Shri Saktijit Dey & Shri Prabhash Shankarincome Tax Officer, Ward V/S. K S Chamankar Enterprises, – 41(3)(2), Room No. 851, बनाम B-15, Pethe Nagar, Kedarmal 8Th Floor, Kautilya Bhavan, Road, Malad(E), Mumbai – Bandra Kurla Complex, 400097, Maharashtra Bandra (East), Mumbai 400051, Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aagfk5823R Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Bharat Raichandani, Adv. [virtually appear]For Respondent: Shri Ritesh Mishra,(CIT-DR)

Section 143(3)Section 147Section 28

…tax on such hypothetical income. Reliance is placed on the following cases as decided by the hon’ble Supreme Court in Jamshri Ranjit Singh ji Spg. & Wvg. Mills v. Inspecting Asstt. Commissioner [1992] 41 ITD 142 (Bom.), CIT v. Shoorji Vallabhdas & Co. [1962] 46 ITR 144 (SC) and CIT v. Excel Industries Ltd. (Civil Appeal No. 125 of 2013). 5.6 In an alternative argument, it is contented without prejudice, that assuming whilst vehemently denying that the tax was leviable on the accrual of the FSI, the FSI so held to be accrued to the firm is a sum total of the work undertaken for almost six years i.e., from the pe…

Deputy Commissioner of Income Tax, Circle-1(1), New Delhi, Delhi vs. Aadharshilla Contractors Pvt Ltd, Delhi

In the result, the grounds raised by the Revenue are dismissed

ITA 4208/DEL/2024[2018-19]Status: DisposedITAT Delhi06 Aug 2025AY 2018-19

Bench: Shri Challa Nagendra Prasad & Shri S. Rifaur Rahmanaadharshilla Contractors Private Limited, Vs. Dcit, Circle 1 (1), 2Nd Floor, Shahdara Metro Station, Delhi. Parsvnath Tower, Delhi – 110 032. (Pan : Aaeca3452D) Dcit, Circle 1 (1), Vs. Aadharshilla Contractors Private Limited, 2Nd Floor, Shahdara Metro Station, Delhi. Parsvnath Tower, Delhi – 110 032. (Pan : Aaeca3452D) (Appellant) (Respondent) Assessee By : Shri Rajat Jain, Ca Shri Akshat Jain, Ca Revenue By : Shri Ajay Kumar Arora, Sr. Dr Date Of Hearing : 28.05.2025 Date Of Order : 06.08.2025 O R D E R

For Appellant: Shri Rajat Jain, CAFor Respondent: Shri Ajay Kumar Arora, Sr. DR

…rovision in the Act to bring to tax notional interest income. It is trite law that only real income could be taxed and reliance in this regard is placed on the decision of Hon'ble Supreme Court in the case of CIT v. Shoorji Vallabhdas & Co. reported in [1962] 46 ITR 144 (SC) wherein it was held as under: "Income-tax is a levy on income. No doubt, 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, but the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in boo…

Aadharshilla Contractors Private Limited, Shahdara, Delhi vs. Deputy Commissioner of Income Tax, Circle 1(1), Delhi

In the result, the grounds raised by the Revenue are dismissed

ITA 4137/DEL/2024[2017-18]Status: DisposedITAT Delhi06 Aug 2025AY 2017-18

Bench: Shri Challa Nagendra Prasad & Shri S. Rifaur Rahmanaadharshilla Contractors Private Limited, Vs. Dcit, Circle 1 (1), 2Nd Floor, Shahdara Metro Station, Delhi. Parsvnath Tower, Delhi – 110 032. (Pan : Aaeca3452D) Dcit, Circle 1 (1), Vs. Aadharshilla Contractors Private Limited, 2Nd Floor, Shahdara Metro Station, Delhi. Parsvnath Tower, Delhi – 110 032. (Pan : Aaeca3452D) (Appellant) (Respondent) Assessee By : Shri Rajat Jain, Ca Shri Akshat Jain, Ca Revenue By : Shri Ajay Kumar Arora, Sr. Dr Date Of Hearing : 28.05.2025 Date Of Order : 06.08.2025 O R D E R

For Appellant: Shri Rajat Jain, CAFor Respondent: Shri Ajay Kumar Arora, Sr. DR

…rovision in the Act to bring to tax notional interest income. It is trite law that only real income could be taxed and reliance in this regard is placed on the decision of Hon'ble Supreme Court in the case of CIT v. Shoorji Vallabhdas & Co. reported in [1962] 46 ITR 144 (SC) wherein it was held as under: "Income-tax is a levy on income. No doubt, 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, but the substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in boo…

DCIT Central Circle 05, Delhi vs. Deepak Kothari, Kanpur

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

ITA 1834/DEL/2021[20017-18]Status: DisposedITAT Delhi06 Aug 2025

Bench: SHRI S. RIFAUR RAHMAN (Accountant Member), SHRI VIMAL KUMAR (Judicial Member)

For Appellant: Dr. Rakesh Gupta, AdvocateFor Respondent: Shri Dayainder Singh Sidhu, CIT DR

Section 143(3)Section 49(4)Section 56(2)(vii)

…t permits the taxation of Real Income and not the notional Income as held in the following judgments: a) Hon'ble Supreme Court in the case of E.D. Sassoon & Co. Ltd.'s case 26 ITR 27 (SC) b) Hon'ble Supreme Court in the case of CIT v. Shoorji Vallabhdas & Co. 46 ITR 144 (SC) c) Hon'ble Supreme Court in the case of Excel Industries (SC) 358 ITR 0295 4.1.17 In view of above discussion, it is held that-the appellant has rightly computed long term capital gain as per mode of computation prescribed in section 48 of Income Tax Act and the Assessing Officer was not justified in computing income on notional basis taking…

Deepak Kathari, Kanpur vs. ACIT, CC-5, New Delhi

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

ITA 1205/DEL/2021[2017-18]Status: DisposedITAT Delhi06 Aug 2025AY 2017-18

Bench: SHRI S. RIFAUR RAHMAN (Accountant Member), SHRI VIMAL KUMAR (Judicial Member)

For Appellant: Dr. Rakesh Gupta, AdvocateFor Respondent: Shri Dayainder Singh Sidhu, CIT DR

Section 143(3)Section 49(4)Section 56(2)(vii)

…t permits the taxation of Real Income and not the notional Income as held in the following judgments: a) Hon'ble Supreme Court in the case of E.D. Sassoon & Co. Ltd.'s case 26 ITR 27 (SC) b) Hon'ble Supreme Court in the case of CIT v. Shoorji Vallabhdas & Co. 46 ITR 144 (SC) c) Hon'ble Supreme Court in the case of Excel Industries (SC) 358 ITR 0295 4.1.17 In view of above discussion, it is held that-the appellant has rightly computed long term capital gain as per mode of computation prescribed in section 48 of Income Tax Act and the Assessing Officer was not justified in computing income on notional basis taking…

Chandra Bros., Kolkata vs. I.T.O., Ward - 37(1), Kolkata

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

ITA 1572/KOL/2024[2022-2023]Status: DisposedITAT Kolkata22 Jul 2025AY 2022-2023

Bench: Sri Pradip Kumar Choubey & Sri Rakesh Mishra

Section 143(1)Section 145(2)Section 250Section 44A

…Sampatram vs. CIT (1953) 24 ITR 481 (SC) and CIT vs. Hind Construction Ltd. 1974 CTR (SC) 157: (1972) 83 ITR 211 (SC); and iii) It is well settled that what is taxable under the income-tax law is only real income vide CIT vs. Shoorji Vallabhdas and Co. (1962) 46 ITR 144 (SC) and CIT vs. Birla Gwalior (P) Ltd. 1973 CTR (SC) 349: (1973) 89 ITR 266 (SC). There is, therefore, no principle by which the stock-in-trade can be valued at market price so as to bring to tax the notional profits which might in future be realised as a result of the sale of the stock-in-trade. In the present case, if the valuation of closing s…

Heera Lal Kasara, Udaipur vs. ITO, Ward-2(1), Udaipur

In the result, appeal of the assessee is allowed

ITA 303/JODH/2024[2009-10]Status: DisposedITAT Jodhpur25 Jun 2025AY 2009-10

Bench: Its Hearing Before Your Honours.”

Section 143(1)Section 143(2)Section 143(3)Section 147Section 148Section 250

…o account two points of time at which the liability to tax is attracted via the accrual of the income or its receipt, but the substance of the matter is the income. If income does not result at all, there cannot be a tax.” CIT v. ShoorjiVallabhdas& Co.[(1962) 46 ITR 144/[TS-1-SC-1962] 15. The AO cannot proceed to make an arbitrary addition and base his conclusion purely on guess work. He can do so only if he relates to some evidence or material on the record. The Courts have held if the profit shown by the assessee in his return is not accepted, it is for the taxing authorities to prove that the assessee made mo…

Weir Minerals (India) Private Ltd, New Delhi vs. DCIT Circle-27(1), New Delhi

In the result, the appeal of the assessee is party allowed

ITA 4713/DEL/2019[2012-13]Status: DisposedITAT Delhi06 Jun 2025AY 2012-13

Bench: Ms. Madhumita Roy & Shri Khettra Mohan Roy[Assessment Year 2012-13]

Section 143(3)Section 234B

…following judicial precedents wherein it was held that "If income does not result at all, there cannot be a tax, even though in book- keeping, an entry is made about a "hypothetical income", which does not materialise" • CIT v. Shoorji Vallabhdas & Co. [1962] 46 ITR 144 (SC), wherein the Hon ble supreme court has held as under: "Income-tax is a levy on income. No doubt, 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; but the substance of the matter is the income. If income does not result at all, there cannot be…