CIT v. Walchand & Co.

65 ITR 381Supreme Court of India1967#246 most cited

What is CIT v. Walchand & Co. authority for?

The necessity and reasonableness of business expenditure, including the utilization of borrowed funds, must be judged from the perspective of a businessman based on commercial expediency, and cannot be dictated by revenue authorities. The onus is on the assessee to demonstrate the business purpose and commercial expediency.

314

judgments rely on this decision, according to BharatTax’s citation analysis of 367,837 Indian tax judgments — from 2008 to 2026.

Also referred to as

CIT v. Walchand & Co. · 65 ITR 381 · Section 40A(2) · Section 40A(3) · business expediency · commercial expediency · reasonableness of expenditure · necessity of expenditure · businessman's point of view · onus on assessee · disallowance of expenditure · revenue dictating expenses

Sections most often in play

Section 143(3)Section 14ASection 148Section 147Section 40A(2)(b)Section 40A(3)Section 142(1)Section 142(2A)

Issues it is cited on

section 40(3)short deduction of tdsinterest on interestsection 40a(2)(b)closely held companyshort deduction of taxbusiness expediencysection 40a(2)accumulated profitsrelated party transactioncommercial expediencysection 194j

Judgments citing CIT v. Walchand & Co.

I.T.O WD - 8(3), Kolkata vs. M/S Ruia Sons Pvt Ltd., Kolkata

In the result the appeal by the revenue is partly allowed

ITA 365/KOL/2013[2009-10]Status: DisposedITAT Kolkata03 Mar 2017AY 2009-10

Bench: Hon’Ble Sri M.Balaganesh, Am & Shri Partha Sarathi Chaudhury, Jm] I.T.A No. 365/Kol/2013 Assessment Year : 2009-10 I.T.O., Ward-8(3), -Vs.- M/S. Ruia Sons Pvt. Ltd. Kolkata Kolkata [Pan : Aaccr 3949 Q] (Respondent) (Appellant) For The Appellant : Shri Arup Kumar Sinha, Cit For The Respondent : Shri Manoj Kataruka, Advocate

For Appellant: Shri Arup Kumar Sinha, CITFor Respondent: Shri Manoj Kataruka, Advocate
Section 143(2)Section 143(3)Section 194CSection 194JSection 301Section 40

…IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH : KOLKATA [Before Hon’ble Sri M.Balaganesh, AM & Shri Partha Sarathi Chaudhury, JM] I.T.A No. 365/Kol/2013 Assessment Year : 2009-10 I.T.O., Ward-8(3), -vs.- M/s. Ruia Sons Pvt. Ltd. Kolkata Kolkata [PAN : AACCR 3949 Q] (Respondent) (Appellant) For the Appellant : Shri Arup Kumar Sinha, CIT For the Respondent : Shri Manoj Kataruka, Advocate Date of Hearing : 02.02.2017. Date of Pronouncement : 03.03.2017. ORDER Per Shri Partha Sarathi Chaudhury, JM This appeal preferred by the Revenue emanates from the order of ld. CIT(A)- VIII, Kolkata dated 26.11.2012 on t…

M/S. Samtel Glass Limited, New Delhi vs. ACIT, New Delhi

In the result, the appeal of the Assessee is allowed

ITA 534/DEL/2014[2009-10]Status: DisposedITAT Delhi03 Mar 2017AY 2009-10

Bench: Shri H.S. Sidhu & Shri Prashant Maharishiassessment Year: 2009-10 M/S Samtel Glass Limited, Vs. Acit, 501, Copia Corporate Suites, Circle-7(1), District Centre-Jasola, C.R. Bldg., New Delhi – 110 025 New Delhi (Pan: Aaacs2730C)

For Appellant: SH. D.C. GARG, CAFor Respondent: SMT. SHAVETA NAKRA DUTTA, SR. DR
Section 142(1)Section 143Section 143(2)Section 143(3)

…d to decide how much is reasonable expenditure having regard to the circumstances of the case. Copy of the decision is attached herewith at page no 36 - 44. 14. Hon'ble Hon'ble Supreme Court in the matter of CIT, Bombay Vs. Walchand and Co. Private Ltd (1967) 65 ITR 381 (SC) ITA No 1249/2011 held that in applying the test of commercial expediency for determining whether an expenditure was wholly and exclusively for business, the expenditure has to be adjudged from the point of view of the businessman and not of revenue. It is humbly prayed that notional interest made by the AO and confirmed by the CIT(A) may kind…

M/S Sheetu Educational Service Pvt Ltd., Indore vs. The DCIT 5(1), Indore

In the result, all the appeals of the assessee for assessment year 2005-06 to 2010-11 are partly allowed as per our

ITA 354/IND/2016[2010-11]Status: DisposedITAT Indore28 Feb 2017AY 2010-11

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

Section 147Section 234BSection 27

…and in what circumstances it should incur. It was reiterated that every businessman knows his interest best - CIT v. Dhanrajgirji Raja Narasinghirji (1973) 91 ITR 544 (SC). The decision of the Hon'ble Supreme Court in the case of CIT vs. Walchand & Co. (1967) 65 ITR 381 (SC) was referred to and it was submitted that in applying the test of commercial expediency whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the business man and not of the revenue. The Hon'ble Bombay High Court's decision in the c…

M/S Sheetu Educational Service Pvt Ltd., Indore vs. The DCIT 5(1), Indore

In the result, all the appeals of the assessee for assessment year 2005-06 to 2010-11 are partly allowed as per our

ITA 352/IND/2016[2008-09]Status: DisposedITAT Indore28 Feb 2017AY 2008-09

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

Section 147Section 234BSection 27

…and in what circumstances it should incur. It was reiterated that every businessman knows his interest best - CIT v. Dhanrajgirji Raja Narasinghirji (1973) 91 ITR 544 (SC). The decision of the Hon'ble Supreme Court in the case of CIT vs. Walchand & Co. (1967) 65 ITR 381 (SC) was referred to and it was submitted that in applying the test of commercial expediency whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the business man and not of the revenue. The Hon'ble Bombay High Court's decision in the c…

M/S. Sheetu Educational Services P. Ltd., Indore vs. The DCIT 5(1), Indore

In the result, all the appeals of the assessee for assessment year 2005-06 to 2010-11 are partly allowed as per our

ITA 26/IND/2015[2007-08]Status: DisposedITAT Indore28 Feb 2017AY 2007-08

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

Section 147Section 234BSection 27

…and in what circumstances it should incur. It was reiterated that every businessman knows his interest best - CIT v. Dhanrajgirji Raja Narasinghirji (1973) 91 ITR 544 (SC). The decision of the Hon'ble Supreme Court in the case of CIT vs. Walchand & Co. (1967) 65 ITR 381 (SC) was referred to and it was submitted that in applying the test of commercial expediency whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the business man and not of the revenue. The Hon'ble Bombay High Court's decision in the c…

M/S. Sheetu Educational Services P. Ltd., Indore vs. The DCIT 5(1), Indore

In the result, all the appeals of the assessee for assessment year 2005-06 to 2010-11 are partly allowed as per our

ITA 25/IND/2015[2006-07]Status: DisposedITAT Indore28 Feb 2017AY 2006-07

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

Section 147Section 234BSection 27

…and in what circumstances it should incur. It was reiterated that every businessman knows his interest best - CIT v. Dhanrajgirji Raja Narasinghirji (1973) 91 ITR 544 (SC). The decision of the Hon'ble Supreme Court in the case of CIT vs. Walchand & Co. (1967) 65 ITR 381 (SC) was referred to and it was submitted that in applying the test of commercial expediency whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the business man and not of the revenue. The Hon'ble Bombay High Court's decision in the c…

M/S. Sheetu Educational Services P Ltd., Indore vs. The DCIT 5(1) Range-5, Indore

In the result, all the appeals of the assessee for assessment year 2005-06 to 2010-11 are partly allowed as per our

ITA 24/IND/2015[2005-06]Status: DisposedITAT Indore28 Feb 2017AY 2005-06

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

Section 147Section 234BSection 27

…and in what circumstances it should incur. It was reiterated that every businessman knows his interest best - CIT v. Dhanrajgirji Raja Narasinghirji (1973) 91 ITR 544 (SC). The decision of the Hon'ble Supreme Court in the case of CIT vs. Walchand & Co. (1967) 65 ITR 381 (SC) was referred to and it was submitted that in applying the test of commercial expediency whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the business man and not of the revenue. The Hon'ble Bombay High Court's decision in the c…

I.T.O WD - 7(3), Kolkata. vs. M/S Shalini Properties & Developers Private Limited., Kolkata

In the result the appeal preferred by the revenue is dismissed

ITA 171/KOL/2013[2009-10]Status: DisposedITAT Kolkata28 Feb 2017AY 2009-10

Bench: Hon’Ble Sri M.Balaganesh, Am & Shri Partha Sarathi Chaudhury, Jm] I.T.A No. 171/Kol/2013 Assessment Year : 2009-10 I.T.O., Ward-7(3) -Vs.- M/S. Shalini Properties & Developers Kolkata Pvt. Limited., Kolkata [Pan : Aahcs 7896 N] (Respondent) (Appellant) For The Appellant : Shri Arup Kumar Sinha, Cit For The Respondent : Shri Manoj Kataruka, Advocate

For Appellant: Shri Arup Kumar Sinha, CITFor Respondent: Shri Manoj Kataruka, Advocate
Section 143(3)Section 301Section 37(1)

…09-10 whether an expenditure is wholly and exclusively laid out for the purpose of the business, reasoonablen3ess of the expenditure has to be adjudged from the point of view of businessman and not of the revenue as held in CIT vs. Walchand & Co.(P)Ltd [1967] 65 ITR 381 (SC). In Sasson J.David & Co.(P)Ltd. Vs. CIT [1979] 118 ITR 261 (SC). It has been held that the assessee can claim deduction under section 37(1) even though there is no compelling necessity to incur such expenditure. In Goodyear India ltd. Vs. ITO[2000] 73 ITD 189/68TTJ(Delhi)TM 330, it has been held that expenditure incurred to get right to use l…

DCIT 29(1), Mumbai vs. Dinesh M Shah, Mumbai

In the result, appeal of the revenue is dismissed

ITA 2562/MUM/2015[2010-11]Status: DisposedITAT Mumbai22 Feb 2017AY 2010-11

Bench: Shri Cn Prasad & Shri Ashwani Taneja: (A.Y : 2010-11) Dcit 29(1) Vs. Dinesh M Shah R.No.108, 1St Floor, C-10 Bldg., Prop. M/S Mehula Pratyakshakar Bhavan Enterprises Bandra Kurla Complex 104, Arnath Sravodya Nagar Bandra (E) Jain Mandir, Mulund (W) Mumbai – 400 051 Mumbai – 400 080 Pan : Aagps5149G (अपीलार्थी / Appellant) (प्रत्यर्थी / Respondent) अपीलार्थी की ओर से / Assessee By : Shri Devendra Jain प्रत्यर्थी की ओर से Revenue By : Mrs Beena Santosh सुनवाई की तारीख / Date Of Hearing : 15/02/2017 घोषणा की तारीख Date Of Pronouncement : 22/02/2017 आदेश / O R D E R Per C.N.Prasad (J.M.) : This Appeal Is Filed By The Assessee Against The Order Of The Ld. Cit (Appeals)-40, Mumbai Dated 30.03.2015 For The Assessment Year 2010-11. The Revenue In Its Appeal Has Raised The Following Grounds : “1. On The Facts & In The Circumstances Of The Case, The Ld. Cit(A) Erred In Deleting The Disallowance Of Salary Of Rs.10,11,674/- Without Appreciating The Fact That The Assessee Has Not Proved As To How The Excess Salary Expenditure Laid For Planning Of Expansion Of The Business & As To How The Same Did

For Appellant: Shri Devendra JainFor Respondent: Mrs Beena Santosh
Section 22

…he Act, the assessing officer has only disallowed these expenses observing that there was no commensurate increase in turnover. Before the ld. CIT (Appeals), the assessee relied on the decision of Supreme Court in the case of CIT Vs. Walchand and Co.(P) Ltd. [65 ITR 381] and submitted that the Hon’ble Supreme Court held that the rule that increased remuneration can only be justified if there is corresponding increase in the profits of the employer was erroneous. It is the finding of the ld. CIT (Appeals) that the assessee has demonstrated that these expenses were actually incurred which are evidenced from the ban…

Kotak Securities Ltd, Mumbai vs. Addl CIT RG 4(3), Mumbai

ITA 3494/MUM/2010[2007-08]Status: DisposedITAT Mumbai22 Feb 2017AY 2007-08

Bench: S/Shri Rajendra, A.M. & Sanjay Garg,J.M. आयकर अपील सं आयकर अपील सं././././Ita No. 3494/Mum/2010,िनधा"रण आयकर अपील सं आयकर अपील सं िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Year: 2007-08 वष" Kotak Securities Limited Addl. Cit 1St Floor, Bakthawar Range-4(3), Aayakar Bhavan Vs. 229 Nariman Point,Mumbai-400 021. Mumbai-400 020. Pan: Aaack 3436 F (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue By: Shri Pavan Kumar Beerla Assessee By: Shri F.V. Irani सुनवाई क" तारीख / Date Of Hearing: 18.01.2017 घोषणा क" तारीख / Date Of Pronouncement: 22.02.2017 आयकर अिधिनयम आयकर अिधिनयम,1961 क" क" धारा धारा 254(1)के अ"तग"त आदेश के अ"तग"त आदेश आयकर आयकर अिधिनयम अिधिनयम क" क" धारा धारा के अ"तग"त आदेश के अ"तग"त आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सद"य,राजे"" के अनुसार लेखा सद"य राजे"" के अनुसार -Per Rajendra,Am: लेखा सद"य लेखा सद"य राजे"" के अनुसार राजे"" के अनुसार Challenging The Order Dt. 17.03.2010 Of Cit(A)-8,Mumbai The Assessee Has Filed The Present Appeal.Assessee-Company,A Share Broker, Filed Its Return Of Income On 31.10.2007 Declaring Its Total Income Of Rs.390.03 Crores.The Assessing Officer(Ao) Completed Assessment On 30. 03.2009,Determining Its Income At Rs.401.55 Crores.

For Appellant: Shri F.V. IraniFor Respondent: Shri Pavan Kumar Beerla
Section 14ASection 254(1)Section 36(1)(vii)

…3494/M/10(07-08) Kotak Securities Ltd. आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण “ए” ” ” ” "यायपीठ मुंबई म"। आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण "यायपीठ मुंबई म"। "यायपीठ मुंबई म"। "यायपीठ मुंबई म"। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, MUMBAI सव"ी राजे"", लेखा सद"य एवं संजय गग" ,"याियक सद"य Before S/Shri Rajendra, A.M. and Sanjay Garg,J.M. आयकर अपील सं आयकर अपील सं././././ITA No. 3494/Mum/2010,िनधा"रण आयकर अपील सं आयकर अपील सं िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Year: 2007-08 वष" Kotak Securities Limited Addl. CIT 1st Floor, Bakthawar Range-4(3), Aayakar Bhavan Vs. 229 Nariman Point,Mumbai-40…

Globex Energia P.Ltd, Mumbai vs. Asst CIT 6(3), Mumbai

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

ITA 1109/MUM/2014[2010-11]Status: DisposedITAT Mumbai18 Nov 2016AY 2010-11

Bench: Shri Amit Shukla & Shri Ashwani Tanejaassessment Year: 2010-11 Globex Energia P. Ltd. Acit 6(3) 4Th Floor, Sadhna House, 570 Mumbai- बनाम/ Pandurang Budhkar Marg, Vs. Behind Mahindra Towr, S. Worli Mumbai-400018 (Appellant) (Respondent ) P.A. No.Aadcg1161C Appellant By Shri Nishant Thakkar & Mis. Jasmin Amalsadvala (Ar) Revenue By Shri Prakash Mane (Dr) सुनवाई क" तार"ख/Date Of Hearing: 09/11/2016 18/11/2016 आदेश क" तार"ख /Date Of Order:

Section 143(1)Section 143(3)

…tments Ltd. Vs. CIT (20 ITR 1) (SC) 2. J.R. Patel & Sons Pvt. Ltd. 69 ITR 782 (Guj) 3. Raipur Mfg. Co. Ltd. (84 ITR 508,516) (Guj) 4. Security Printers of India Pvt. Ltd. (78 ITR 766,774) (All) 5. Tatasons Ltd. (18 ITR 460,467) (Bom) 6. Walchand & Co. P. Ltd.(65 ITR 381, 385) (SC) 7. J.K. Woolen Manufactures (72 ITR 612) (SC) 8. Aluminium Corp. of India Ltd. (86 ITR 11, 17) (SC) 9. Orissa Cement Ltd. (73 ITR 14, 17) (Del) In following cases it has been held that expenses shall become deductible after setting up of the business, even if commencement of business has not yet taken place: 1.CIT Vs. Ralliwolf Ltd. (1…

Hero Motocorp Limited, New Delhi vs. JCIT, New Delhi

In the result appeal of the assessee in ITA No

ITA 1545/DEL/2015[2010-11]Status: DisposedITAT Delhi24 Oct 2016AY 2010-11

Bench: Sh. I. C. Sudhir & Shri Prashant Maharishihero Motocorp Limited, Jcit, 34, Basant Lok, Vasant Range-1, New Delhi Vs. Vihar, New Delhi Pan: Aaach0812J (Appellant) (Respondent) Dcit, M/S. Hero Moto Corp. Circle-11(1), Ltd., 34, Community Vs. New Delhi Centre, Basant Lok, Vasant Vihar, New Delhi-110057 (Appellant) (Respondent) Dcit, M/S. Hero Moto Corp. Circle-11(1), Ltd., 34, Community

For Appellant: Sh. Ajay Vohra, Sr. AdvFor Respondent: Sh. NC Sawain, CIT DR
Section 143Section 143(3)Section 144CSection 92C

…pply to the facts of the case. We now proceed to answer whether the action of the Assessing Officer in disallowing the expenditure on the ground of commercial expediency is justified. 13.23. The Hon‘ble Supreme Court in the case of CIT vs Walchand & Co [1967] 65 ITR 381 in the context of deductibility of expenditure under Section 37(1) of the Income-tax Act, 1961 [Corresponding to section 10(2)(xv) of the Indian Income-tax Act, 1922] held as under: ―In applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purpose of the business, reasonablen…

DCIT Cir 3, Thane vs. Shubh Builders & Developers, Mumbai

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

ITA 2380/MUM/2014[2010-11]Status: DisposedITAT Mumbai30 Sept 2016AY 2010-11

Bench: Shri Rajendra & Shri C.N. Prasadआयकर अपील सं /I.Ta No. 2380/Mum/2014 ("नधा"रण वष" / Assessment Year:2010-11 The Dcit, Circle-3, M/S. Shubh Builders & बनाम/ B-Wing, Ashar It Park, Developers, Vs. Road No. 16Z, Ofice No. H. Dev Prayag, Wagle Ind. Estate, Gr Floor, Bhakti Mandir Road, Thane(W),-400 602 Pachpakhadi, Thane(W),-400 602 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Abffs 1174D .. (अपीलाथ" /Appellant) (""यथ" / Respondent) Shri Kailash Gaikwad अपीलाथ" ओर से/ Appellant By: ""यथ" क" ओर से/Respondent By: Shri Subodh Ratnaparakhi

For Respondent: Shri Subodh
Section 143(3)

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ , मुंबई । IN THE INCOME TAX APPELLATE TRIBUNAL “E ” BENCH, MUMBAI BEFORE SHRI RAJENDRA, ACCOUNTANT MEMBER AND SHRI C.N. PRASAD, JUDICIAL MEMBER आयकर अपील सं /I.TA No. 2380/Mum/2014 ("नधा"रण वष" / Assessment Year:2010-11 The DCIT, Circle-3, M/s. Shubh Builders & बनाम/ B-Wing, Ashar IT Park, Developers, Vs. Road No. 16Z, Ofice No. H. Dev Prayag, Wagle Ind. Estate, Gr Floor, Bhakti Mandir Road, Thane(W),-400 602 Pachpakhadi, Thane(W),-400 602 "थायी लेखा सं./जीआइआर सं./PAN/GIR No. ABFFS 1174D .. (अपीलाथ" /Appellant) (""यथ" / Respondent) Shri Kailash Gaikwad अपीलाथ" ओर से/ Appellan…

Ramesh Builders, Mumbai vs. ITO 12(1)(1), Mumbai

In the result, the appeal filed by the assessee-Ramesh Builders(India) in ITA N0

ITA 1798/MUM/2012[2007-08]Status: DisposedITAT Mumbai27 Jul 2016AY 2007-08

Bench: Shri Saktijit Dey & Shri Ramit Kocharआयकर अपील सं./I.T.A. No.1797/Mum/2012 ("नधा"रण वष" / Assessment Year : 2007-08) Ramesh Builders (India), Income Tax बनाम/ 9, Dhiraj Chambers, Officer,12(1)(2),Aayakar V. 9, Hazarimal Somani Marg, Bhavan,M.K. Road, Fort,Mumbai – 400001. Mumbai. "थायी लेखा सं./Pan : Aaafr4655E .. (अपीलाथ" /Appellant) (""यथ" / Respondent)

For Respondent: Dr. Mukesh Jain,DR
Section 143(3)Section 45(4)

…(1) of the Act. The assessee placed reliance on the following decisions:- (i) Jugal Kishore Baldev Sahai v. CIT (1967) 63 ITR 228. (ii) Sri Venkata Satyanarayana Rice Mill Contractors Co. v. CIT (1977) 223 ITR 101. (iii) CIT v. Walchand & Co. (P) Ltd. (1967) 65 ITR 381 (iv) Sasson J. David & Co. (P) Ltd. v. CIT (1979) 118 ITR 261 (v) CIT v. Birla Cotton Spg. & Wvg.Mills (1972) 82 ITR 166 (vi)S.A. Builders Ltd. v. CIT (2007) 288 ITR 1 ITA 1797/Mum/2012 & 40 ITA 1798/Mum/2012 The A.O. went through the submission of the assessee and distinguished the case laws relied upon by the assessee by observing as under:-…

Ramesh Builders (India), Mumbai vs. ITO 12(1)(2), Mumbai

In the result, the appeal filed by the assessee-Ramesh Builders(India) in ITA N0

ITA 1797/MUM/2012[2007-08]Status: DisposedITAT Mumbai27 Jul 2016AY 2007-08

Bench: Shri Saktijit Dey & Shri Ramit Kocharआयकर अपील सं./I.T.A. No.1797/Mum/2012 ("नधा"रण वष" / Assessment Year : 2007-08) Ramesh Builders (India), Income Tax बनाम/ 9, Dhiraj Chambers, Officer,12(1)(2),Aayakar V. 9, Hazarimal Somani Marg, Bhavan,M.K. Road, Fort,Mumbai – 400001. Mumbai. "थायी लेखा सं./Pan : Aaafr4655E .. (अपीलाथ" /Appellant) (""यथ" / Respondent)

For Respondent: Dr. Mukesh Jain,DR
Section 143(3)Section 45(4)

…(1) of the Act. The assessee placed reliance on the following decisions:- (i) Jugal Kishore Baldev Sahai v. CIT (1967) 63 ITR 228. (ii) Sri Venkata Satyanarayana Rice Mill Contractors Co. v. CIT (1977) 223 ITR 101. (iii) CIT v. Walchand & Co. (P) Ltd. (1967) 65 ITR 381 (iv) Sasson J. David & Co. (P) Ltd. v. CIT (1979) 118 ITR 261 (v) CIT v. Birla Cotton Spg. & Wvg.Mills (1972) 82 ITR 166 (vi)S.A. Builders Ltd. v. CIT (2007) 288 ITR 1 ITA 1797/Mum/2012 & 40 ITA 1798/Mum/2012 The A.O. went through the submission of the assessee and distinguished the case laws relied upon by the assessee by observing as under:-…

Amserve Consultants Ltd., New Delhi vs. ADIT, New Delhi

In the result both the appeals of the assesses are allowed

ITA 6059/DEL/2013[2009-10]Status: DisposedITAT Delhi29 Jun 2016AY 2009-10

Bench: Shri I.C. Sudhir & Shri J. Sudhakar Reddyay: 2009-10

For Appellant: Sh. C.S.Agarwal, Sr.AdvFor Respondent: Sh. Ravi Jain, CIT, D.R
Section 143(3)Section 40A(2)Section 40A(2)(b)

…is that no businessman can be compelled to maximise his profits. The obvious answer to the first question is in the affirmative, in favour of the assessee and against the Revenue.” (ii) The Hon’ble Supreme Court in the case of CIT vs. Walchand and Co. P.Ltd. 65 ITR 381 held that “In applying the test of commercial expediency for determining whether expenditure was wholely and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be adjudged from the point of view of the business men and not of the Revenue.” ITA 6059/Del/2013 M/s Amserve Consultants Ltd. ITA 6090/Del/13 M/s A…

Fabindia Overseas Pvt. Ltd., New Delhi vs. DCIT, New Delhi

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

ITA 2245/DEL/2013[2009-10]Status: DisposedITAT Delhi13 Jun 2016AY 2009-10

Bench: Shri S.V. Mehrotra & Shri Sudhanshu Srivastavaasstt. Year: 2009-10 Asstt. Year: 2007-08

For Appellant: S/Shri Aseem Chawla, AdvFor Respondent: Shri A.M.Govil, CIT DR
Section 80

…Court is deciding a question under Section 12(2) of the Income Tax Act”. It was further held in this case that “it is not necessary to show that the expenditure was a profitable one or that in fact any profit was earned”. In CIT v. Walchand & Co. etc., (1967) 65 ITR 381, it was held by the Supreme Court that in applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the businessman and not of the Revenue. It was further observed that the rule that…

Fabindia Overseas Pvt. Ltd., New Delhi vs. DCIT, New Delhi

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

ITA 2244/DEL/2013[2007-08]Status: DisposedITAT Delhi13 Jun 2016AY 2007-08

Bench: Shri S.V. Mehrotra & Shri Sudhanshu Srivastavaasstt. Year: 2009-10 Asstt. Year: 2007-08

For Appellant: S/Shri Aseem Chawla, AdvFor Respondent: Shri A.M.Govil, CIT DR
Section 80

…Court is deciding a question under Section 12(2) of the Income Tax Act”. It was further held in this case that “it is not necessary to show that the expenditure was a profitable one or that in fact any profit was earned”. In CIT v. Walchand & Co. etc., (1967) 65 ITR 381, it was held by the Supreme Court that in applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the businessman and not of the Revenue. It was further observed that the rule that…

DCIT, New Delhi vs. M/S. Fabindia Overseas (P) Ltd., New Delhi

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

ITA 1898/DEL/2013[2007-08]Status: DisposedITAT Delhi13 Jun 2016AY 2007-08

Bench: Shri S.V. Mehrotra & Shri Sudhanshu Srivastavaasstt. Year: 2009-10 Asstt. Year: 2007-08

For Appellant: S/Shri Aseem Chawla, AdvFor Respondent: Shri A.M.Govil, CIT DR
Section 80

…Court is deciding a question under Section 12(2) of the Income Tax Act”. It was further held in this case that “it is not necessary to show that the expenditure was a profitable one or that in fact any profit was earned”. In CIT v. Walchand & Co. etc., (1967) 65 ITR 381, it was held by the Supreme Court that in applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the businessman and not of the Revenue. It was further observed that the rule that…

DCIT, New Delhi vs. M/S Fabindia Overseas (P) Ltd., New Delhi

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

ITA 1894/DEL/2013[2009-10]Status: DisposedITAT Delhi13 Jun 2016AY 2009-10

Bench: Shri S.V. Mehrotra & Shri Sudhanshu Srivastavaasstt. Year: 2009-10 Asstt. Year: 2007-08

For Appellant: S/Shri Aseem Chawla, AdvFor Respondent: Shri A.M.Govil, CIT DR
Section 80

…Court is deciding a question under Section 12(2) of the Income Tax Act”. It was further held in this case that “it is not necessary to show that the expenditure was a profitable one or that in fact any profit was earned”. In CIT v. Walchand & Co. etc., (1967) 65 ITR 381, it was held by the Supreme Court that in applying the test of commercial expediency for determining whether the expenditure was wholly and exclusively laid out for the purpose of business, reasonableness of the expenditure has to be judged from the point of view of the businessman and not of the Revenue. It was further observed that the rule that…