CIT v. Vinitec Corporation (P) Ltd.

278 ITR 337High Court2005#2257 most cited

What is CIT v. Vinitec Corporation (P) Ltd. authority for?

A provision for warranty liability, even if quantified on an estimated basis, is considered a definite and certain business liability, qualifying for deduction under Section 37(1) of the Income-tax Act, and is not a contingent liability.

51

judgments rely on this decision, according to BharatTax’s citation analysis of 367,368 Indian tax judgments — from 2007 to 2026.

Also referred to as

CIT v. Vinitec Corporation (P) Ltd. · Vinitec Corporation · 278 ITR 337 · Section 37(1) · provision for warranty · warranty claims · contingent liability · definite and certain liability · estimated liability · business expenditure deduction

Also reported as

196 CTR 369

Sections most often in play

Section 143(3)Section 115JBSection 147Section 148Section 195Section 37(1)Section 40(a)(ia)Section 44

Issues it is cited on

section 33acproximate nexusdepreciation on softwaresection 10(35)dependent agent pesection 64service pesection 135csr expendituresection 40(a)(i)weighted deductionfirst proviso to section 147

Judgments citing CIT v. Vinitec Corporation (P) Ltd.

Sbi Cards Payment Services Pvt. Ltd., New Delhi vs. ACIT, New Delhi

The appeal of the assessee stands partly allowed in terms of our observations and directions contained in

ITA 5879/DEL/2013[2008-09]Status: DisposedITAT Delhi23 Oct 2018AY 2008-09

Bench: Shri N.K.Saini, Hon’Ble & Shri Sudhanshu Srivastavaassessment Year: 2008-09 Sbi Cards Payment Acit Services Pvt. Ltd. Circle-7(1), 401,402, 4Th Floor, C.R.Building, I.P.Estate Aggarwal Millenium New Delhi Vs. Tower, E 1,2,3, Netaji Subhash Place, Wazirpur New Delhi Pan : Aaecs5981K Appellant Respondent Revenue By : Shri K. Tewari, Sr. Dr Assessee By : Shri Tushar Jarwal, Rahul Sateeja, Adv. Date Of Hearing : 26.07.2018 Date Of Pronouncement : 23.10.2018

For Appellant: Shri Tushar Jarwal, Rahul Sateeja, AdvFor Respondent: Shri K. Tewari, Sr. DR
Section 143(1)

…passed by his predecessors for AY 2006-07 and 2007-08. That the Ld. CIT(A) has erred in not appreciating the 1.4. fact that reliance placed by the Ld. AO on decision of the jurisdictional High Court in the case of CIT vs. Vinitec Corporation Pvt. Ltd. (2005) 278 ITR 337 (Del) in fact supports the claim of the Appellant that where a provision is capable of being construed in definite terms though its actual quantification and discharge is deferred to a future date, it is an allowable expense. 2. Disallowance of ad-hoc advertisement expenses On the facts and in the circumstances of the case, the 2.1. Ld. CIT(A) ha…

Maruti Suzuki India Ltd., New Delhi vs. Addl. CIT, New Delhi

Appeal of the assessee is partly allowed for statistical purpose

ITA 467/DEL/2014[2009-10]Status: DisposedITAT Delhi17 Oct 2018AY 2009-10

Bench: Shri R. K. Panda & Ms Suchitra Kamblei.T.A .No. 467/Del/2014 (A.Y 2009-10)

Section 143(3)Section 144CSection 144C(5)Section 43Section 43B

…(SC) b) Metal Box (P) Limited (1969): 73 ITR 53 (SC) c) United Commercial Bank v. CIT 240 ITR 355 (SC) d) Bharat Earth Movers: 245 ITR 428 (SC) e) Kelvinator of India Ltd. reported in 256 ITR 1 confirmed by SC in 320 ITR 561 f) CIT v Vinitec Corpn. (P) Ltd.: 278 ITR 337 (Delhi) g) National Mineral Development Corporation Ltd. v. JCIT : 98 ITD 278 (Hyd. ITAT) The Hon’ble Supreme Court in the case of CIT v. Woodward Governor India (P) Ltd. 312 ITR 254 has held that:- “21. In conclusion, we may state that in order to find out if an g) expenditure is deductible the following have to be taken into account (i) wheth…

M/S. Keihin Panalfa Ltd., Gurgaon vs. ACIT, New Delhi

In the result the appeal of the Department stands partly

ITA 1790/DEL/2014[2009-10]Status: DisposedITAT Delhi19 Jun 2018AY 2009-10

Bench: Shri R.K. Panda & Shri Sudhanshu Srivastava

For Appellant: Shri R.K. Kapoor, CAFor Respondent: Shri Sanjay I. Bara, CIT DR, Smt. Namita Panday, Sr. DR
Section 40A(2)(b)

…not given any reasoning for making departure from the established practice of allowing deduction on this account. Supreme Court in the case of Rotork Controls India Pvt. Ltd. Vs. CIT 314ITR 62 and the Delhi High Court in CIT Vs. Vinitec Corporation Pvt. Ltd. 278 ITR 337 has held that the provision for warranty if made on scientific and systematic basis is allowance expenditure. Delhi High Court in CIT Vs. Ericsson Communications Private Limited [2009-TIOL- 583- HC-DEL-IT] has likewise held as under: “The taxpayer company is entitled to make provision for the warranty charges holding the same to be a definite bus…

ACIT, New Delhi vs. M/S. Keihin Panalfa Limited, New Delhi

In the result the appeal of the Department stands partly

ITA 1201/DEL/2014[2009-10]Status: DisposedITAT Delhi19 Jun 2018AY 2009-10

Bench: Shri R.K. Panda & Shri Sudhanshu Srivastava

For Appellant: Shri R.K. Kapoor, CAFor Respondent: Shri Sanjay I. Bara, CIT DR, Smt. Namita Panday, Sr. DR
Section 40A(2)(b)

…not given any reasoning for making departure from the established practice of allowing deduction on this account. Supreme Court in the case of Rotork Controls India Pvt. Ltd. Vs. CIT 314ITR 62 and the Delhi High Court in CIT Vs. Vinitec Corporation Pvt. Ltd. 278 ITR 337 has held that the provision for warranty if made on scientific and systematic basis is allowance expenditure. Delhi High Court in CIT Vs. Ericsson Communications Private Limited [2009-TIOL- 583- HC-DEL-IT] has likewise held as under: “The taxpayer company is entitled to make provision for the warranty charges holding the same to be a definite bus…

Maruti Suzuki India Ltd., New Delhi vs. Addl. CIT, New Delhi

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

ITA 6021/DEL/2012[2008-09]Status: DisposedITAT Delhi09 Nov 2017AY 2008-09

Bench: Shri N.K. Saini & Shri K.N. Charry

Section 143(3)Section 144CSection 144C(5)Section 14ASection 35DSection 43BSection 92C

…2007-08, and also the decisions reported in Calcutta Discount Co. Ltd.: 37 ITR 1 (SC), Metal Box India (P) Limited (1969): 73 ITR 53 (SC) , United Commercial Bank v. CIT 240 ITR 355 (SC), Bharat Earth Movers: 245 ITR 428 (SC) , CIT v Vinitec Corpn. (P) Ltd.: 278 ITR 337 (Delhi), National Mineral Development Corporation Ltd. v JCIT: 98 ITD 278 (Hyd. ITAT), Ld. AR argued that that liability which has arisen in the relevant accounting year is an allowable deduction even though its actual quantification and discharge is deferred to a future date. In respect of the vendor-wise and item-wise details of total provision…

Anchor Electricals Pvt. Ltd., Mumbai vs. A.C.I.T. Cen.Cir.41, Mumbai

In the result of appeals of the assessee are partly allowed

ITA 6930/MUM/2012[2008-09]Status: DisposedITAT Mumbai26 Apr 2017AY 2008-09

Bench: Shri C.N. Prasad () & Shri Ashwani Taneja ()

Section 143(3)Section 144C(13)Section 144C(5)

…the year in which changed takes place; however in the same cannot be disallowed merely because the claim is higher as compared to other years. Reliance was also placed on the judgment of Hon’ble Delhi High Court in the case of CIT v. Vinitiec Corporation Ltd. 278 ITR 337 Delhi (Del) for the preposition that assessee is entitled to change method of accounting from ‘’actual basis” to “provision basis””. With regard to the adjustment made in the book profit compute u/s 115JB by the AO on account of provision of warranty, it was submitted that Ld. Counsel that the provision for warranty is not unascertained liability…

Asst CIT Cir 2, Kalyan vs. Medirays Corporation, Thane

In the result, the appeal filed by the revenue is dismissed

ITA 190/MUM/2016[2011-12]Status: DisposedITAT Mumbai30 Mar 2017AY 2011-12

Bench: Shri B.R. Baskaran (Am)& Shri Ravish Sood (Jm)

…at has been discussed in the assessment order. (iv) The appellant has also placed reliance on various court decisions a). CIT vs Maruti Suzuki India ltd. in ITA Nos. 903/993/1029 - 2011(Delhi High Court);(b). CIT vs. Vinitec Corporation Pvt. Ltd. reported in 278 ITR 337 (Del); (c) Rotork Controls India Ltd. vs. CIT reported in 314 ITR 62(SC); (d) Bharat Earth Movers vs. CIT reported in 245 ITR 428(SC) and (e) CIT vs. Inductotherm (India) Pvt Ltd. reported in ITA No.2087 of 2010 dated 27.12.2011 wherein the provisions of warranty were upheld. (v) On going through the above, the claim of provision for warranty exp…

The ACIT, 1(1), Bhopal vs. M/S. Andritz Hydro Pvt. Ltd., Raisen

In the result, grounds taken by the assessee in all the years with respect to provision of warranty are allowed

ITA 349/IND/2016[2011-12]Status: DisposedITAT Indore28 Feb 2017AY 2011-12

Bench: Shri D.T. Garasia & Shri O.P. Meena

Section 143(3)Section 144C

…he contentions of the assessee: • DCIT-3(1), Bhopal vs VA TECH Hydro India Private Limited (ITA No 255/IND- 2007). • Rotork Controls India (P) Ltd - 2009-TIOL-64-SCIT • Bharat Earth Movers v CIT - 245 ITR 428 (2000) (SC) • CIT v Vinitec Corporation Pvt Ltd - 278 ITR 337 (2005) (Del) • CIT vs. Majestic Auto Ltd. (204 ITR (AT) 14) (Chd) 9.5.3. Hence, based on the above, it can be concluded that the provision for warranty is in the nature of an ascertained liability (with a reasonable estimate of the quantum) and not a “contingent liability”, hence, a deduction for the same should be allowed while computing the…

M/S Andritz Hydro Private Limited (Earlier Known As V A Tech Hydro Indai Pvt. Ltd.), Mandideep vs. The ACIT 1(1), Bhopal

In the result, grounds taken by the assessee in all the years with respect to provision of warranty are allowed

ITA 316/IND/2016[2011-12]Status: DisposedITAT Indore28 Feb 2017AY 2011-12

Bench: Shri D.T. Garasia & Shri O.P. Meena

Section 143(3)Section 144C

…he contentions of the assessee: • DCIT-3(1), Bhopal vs VA TECH Hydro India Private Limited (ITA No 255/IND- 2007). • Rotork Controls India (P) Ltd - 2009-TIOL-64-SCIT • Bharat Earth Movers v CIT - 245 ITR 428 (2000) (SC) • CIT v Vinitec Corporation Pvt Ltd - 278 ITR 337 (2005) (Del) • CIT vs. Majestic Auto Ltd. (204 ITR (AT) 14) (Chd) 9.5.3. Hence, based on the above, it can be concluded that the provision for warranty is in the nature of an ascertained liability (with a reasonable estimate of the quantum) and not a “contingent liability”, hence, a deduction for the same should be allowed while computing the…

The DCIT, 1(1), Bhopal vs. M/S. Andritz Hydro Pvt. Ltd., Raisen

In the result, grounds taken by the assessee in all the years with respect to provision of warranty are allowed

ITA 265/IND/2015[2010-11]Status: DisposedITAT Indore28 Feb 2017AY 2010-11

Bench: Shri D.T. Garasia & Shri O.P. Meena

Section 143(3)Section 144C

…he contentions of the assessee: • DCIT-3(1), Bhopal vs VA TECH Hydro India Private Limited (ITA No 255/IND- 2007). • Rotork Controls India (P) Ltd - 2009-TIOL-64-SCIT • Bharat Earth Movers v CIT - 245 ITR 428 (2000) (SC) • CIT v Vinitec Corporation Pvt Ltd - 278 ITR 337 (2005) (Del) • CIT vs. Majestic Auto Ltd. (204 ITR (AT) 14) (Chd) 9.5.3. Hence, based on the above, it can be concluded that the provision for warranty is in the nature of an ascertained liability (with a reasonable estimate of the quantum) and not a “contingent liability”, hence, a deduction for the same should be allowed while computing the…

M/S. Andritz Hydro Private Limited (Earlier Known As Va Tech Hydro India Private Limited), Bhopal vs. The DCIT 1(1), Bhopal

In the result, grounds taken by the assessee in all the years with respect to provision of warranty are allowed

ITA 157/IND/2015[2010-11]Status: DisposedITAT Indore28 Feb 2017AY 2010-11

Bench: Shri D.T. Garasia & Shri O.P. Meena

Section 143(3)Section 144C

…he contentions of the assessee: • DCIT-3(1), Bhopal vs VA TECH Hydro India Private Limited (ITA No 255/IND- 2007). • Rotork Controls India (P) Ltd - 2009-TIOL-64-SCIT • Bharat Earth Movers v CIT - 245 ITR 428 (2000) (SC) • CIT v Vinitec Corporation Pvt Ltd - 278 ITR 337 (2005) (Del) • CIT vs. Majestic Auto Ltd. (204 ITR (AT) 14) (Chd) 9.5.3. Hence, based on the above, it can be concluded that the provision for warranty is in the nature of an ascertained liability (with a reasonable estimate of the quantum) and not a “contingent liability”, hence, a deduction for the same should be allowed while computing the…

Maruti Suzuki India Ltd., New Delhi vs. Addl. CIT, New Delhi

Appeal is allowed

ITA 5720/DEL/2011[2007-08]Status: DisposedITAT Delhi12 Jul 2016AY 2007-08

Bench: Shri I.C. Sudhir & Shri L.P. Sahu Assessment Year: 2007-08 Assessment Year: 2007-08 Maruti Suzuki India Ltd., Vs. Additional Cit, Plot No.1, Nelson Mandela Road, Range-6, Vasant Road, New Delhi. New Delhi. (Pan: Aaacm0829Q) (Appellant) (Respondent) Assessee By: S/Shri Ajay Vohra, Sr. Adv. Neeraj Jain, Rohit Jain, Adv. Romit Katyal & Ms. Tejasvi Jain, Cas Department By:Shri Amrendra Kumar, Cit(Dr)

For Appellant: S/Shri Ajay Vohra, Sr. Adv. NeerajFor Respondent: Shri Amrendra Kumar, CIT(DR)

…d. 37 ITR 1 (SC) c) Metal Box (1969) 73 ITR 53 (SC) d) United Commercial Bank v. CIT 240 ITR 355 (SC) e) Bharat Earth Movers 245 ITR 428 (SC). f) Kelvinator of India Ltd. reported in 256 ITR 1 confirmed by SC in 320 ITR 561 g) CIT v. Vinitec Corpn. (P) Ltd. : 278 ITR 337 (Del.) h) National Mineral Development Corporation Ltd. v. JCIT : 98 ITD 278 (Hyd. ITAT) 26.3.9 The Hon’ble Supreme Court in the case of CIT vs Woodward Governor India (P) Ltd. 312 ITR 254 has held that:- “21. In conclusion, we may state that in order to find out if an expenditure is deductible the following have to be taken into account (i) whe…

The Commissioner of Income Tax vs. M/S Wipro Ge Medical Systems Ltd

Appeals stand disposed of accordingly

ITA/912/2008HC Karnataka07 Jun 2016

Bench: JAYANT PATEL,B.SREENIVASE GOWDA

Section 260

…tion No.1, we are not inclined to remit the matter back to the Assessing Officer on this issue more particularly, this issue being covered by the Judgment of the Co-ordinate Bench of this Court in the very same assessee’s case reported in 270 ITR 259 and 278 ITR 337 confirmed by the Apex Court in Rotork Controls Case (supra).” 19. In view of the aforesaid decision of a Division Bench of this Court, we need not further 28 discuss the matter, more particularly, when the learned Counsel appearing for both the sides are in agreement that question Nos. 1 and 2 in the present matter may be…

The Commissioner of Income Tax vs. M/S Wipro Ge Medical Systems Ltd

Appeals stand disposed of accordingly

ITA/890/2008HC Karnataka07 Jun 2016

Bench: JAYANT PATEL,B.SREENIVASE GOWDA

Section 260

…tion No.1, we are not inclined to remit the matter back to the Assessing Officer on this issue more particularly, this issue being covered by the Judgment of the Co-ordinate Bench of this Court in the very same assessee’s case reported in 270 ITR 259 and 278 ITR 337 confirmed by the Apex Court in Rotork Controls Case (supra).” 19. In view of the aforesaid decision of a Division Bench of this Court, we need not further 28 discuss the matter, more particularly, when the learned Counsel appearing for both the sides are in agreement that question Nos. 1 and 2 in the present matter may be…

Bayer Bioscience Private Limited, Mumbai vs. DCIT, New Delhi

In the result, both the cross appeals filed by the Revenue and the assessee are partly allowed

ITA 2685/DEL/2009[2004-05]Status: DisposedITAT Delhi21 Apr 2016AY 2004-05

Bench: : Shri A.T. Varkey & Shri L.P. Sahuasstt. Year : 2004-05 D.C.I.T. 14(1), Vs. Bayer Bioscience P. Ltd., Mumbai. (Formerly M/S. Proagro Seed Co. P. Ltd. ), Bayer House, Hiranandani Garden, Powai, Mumbai.[Pan: Aaacp 3459M]

For Respondent: Smt. Anima Barnwal, DR

…arat Earth Movers vs. CIT (245 ITR 428) (SC) - Metal Box Company of India Ltd. vs Their Workmen (73 ITR 53) (SC) - Calcutta Co. Ltd. vs CIT (37 ITR 1) (SC) - Rotork Controls India Private Limited vs CIT (314 ITR 62) (SC) - CIT vs Vintec Corporation Pvt. Ltd. (278 ITR 337) [Delhi HC] • Without prejudice to the above submission, in case your honour considers to not allow the expense for special discount in the relevant year under consideration (i.e. FY 2003-04), we humbly request before your honour to grant deduction of special discount in the subsequent year i.e. financial year 2004-05.” 6. After considering the…

The Commissioner of Income Tax vs. M/S Wipro Ge Medical Systems Ltd

Appeal is partly allowed

ITA/902/2008HC Karnataka19 Jan 2016

Bench: S.SUJATHA,N.K.PATIL

Section 10ASection 260Section 260A

…estion No.1, we are not inclined to remit the matter back to the Assessing Officer on this issue more particularly, this issue being covered by the Judgment of the Coordinate Bench of this Court in the very same assessee’s case reported in 270 ITR 259 and 278 ITR 337 confirmed by the Apex Court in Rotork Controls Case (supra). Re. Question No.3 10. Both the learned counsel appearing for the parties agree that the issue involved in this question is covered against the revenue by the Judgment of this Court in ITA No.3202/2005 disposed of on 28.02.2012. 11. In view of the Judgment rendered by…

(Now Pernod Ricard India Pvt.Ltd.)

The appeals are dismissed but in the circumstances with no order as to

ITA/900/2009HC Delhi06 Oct 2015
Section 260A

…for the Assessees, Mr. N.P. Sahni, Senior Standing counsel and Mr. Raghvendra Singh, Junior Standing counsel for the Revenue. 7. Mr. Chopra relied on the decisions in Bharat Earth Movers (supra), Commissioner of Income Tax v. Vinitec Corporation P. Ltd. 278 ITR 337 (Del), Commissioner of Income Tax v. Insilco Ltd. 179 Taxman 55 (Del), Commissioner of Income Tax v. Sony India Pvt. Ltd. [2007] 160 Taxman 397 (Del), Commissioner of Income Tax v. Beema Manufactures Pvt. Ltd. [2003] 130 Taxman 162 (Del) and Commissioner of Income Tax v. Hewlett Packard (P) Ltd. [2008] 173 Taxman 162 (Del) to urge that the…

(Now Pernod Ricard India Pvt.Ltd.)

The appeals are dismissed but in the circumstances with no order as to

ITA/901/2009HC Delhi06 Oct 2015
Section 260A

…for the Assessees, Mr. N.P. Sahni, Senior Standing counsel and Mr. Raghvendra Singh, Junior Standing counsel for the Revenue. 7. Mr. Chopra relied on the decisions in Bharat Earth Movers (supra), Commissioner of Income Tax v. Vinitec Corporation P. Ltd. 278 ITR 337 (Del), Commissioner of Income Tax v. Insilco Ltd. 179 Taxman 55 (Del), Commissioner of Income Tax v. Sony India Pvt. Ltd. [2007] 160 Taxman 397 (Del), Commissioner of Income Tax v. Beema Manufactures Pvt. Ltd. [2003] 130 Taxman 162 (Del) and Commissioner of Income Tax v. Hewlett Packard (P) Ltd. [2008] 173 Taxman 162 (Del) to urge that the…

(Now Pernod Ricard India Pvt.Ltd.)

The appeals are dismissed but in the circumstances with no order as to

ITA/899/2009HC Delhi06 Oct 2015
Section 260A

…for the Assessees, Mr. N.P. Sahni, Senior Standing counsel and Mr. Raghvendra Singh, Junior Standing counsel for the Revenue. 7. Mr. Chopra relied on the decisions in Bharat Earth Movers (supra), Commissioner of Income Tax v. Vinitec Corporation P. Ltd. 278 ITR 337 (Del), Commissioner of Income Tax v. Insilco Ltd. 179 Taxman 55 (Del), Commissioner of Income Tax v. Sony India Pvt. Ltd. [2007] 160 Taxman 397 (Del), Commissioner of Income Tax v. Beema Manufactures Pvt. Ltd. [2003] 130 Taxman 162 (Del) and Commissioner of Income Tax v. Hewlett Packard (P) Ltd. [2008] 173 Taxman 162 (Del) to urge that the…

(Now Pernod Ricard India Pvt.Ltd.)

The appeals are dismissed but in the circumstances with no order as to

ITA/898/2009HC Delhi06 Oct 2015
Section 260A

…for the Assessees, Mr. N.P. Sahni, Senior Standing counsel and Mr. Raghvendra Singh, Junior Standing counsel for the Revenue. 7. Mr. Chopra relied on the decisions in Bharat Earth Movers (supra), Commissioner of Income Tax v. Vinitec Corporation P. Ltd. 278 ITR 337 (Del), Commissioner of Income Tax v. Insilco Ltd. 179 Taxman 55 (Del), Commissioner of Income Tax v. Sony India Pvt. Ltd. [2007] 160 Taxman 397 (Del), Commissioner of Income Tax v. Beema Manufactures Pvt. Ltd. [2003] 130 Taxman 162 (Del) and Commissioner of Income Tax v. Hewlett Packard (P) Ltd. [2008] 173 Taxman 162 (Del) to urge that the…