Distributors (Baroda) (P.) Ltd. v. Union of India

155 ITR 120Supreme Court of India1985#386 most cited

What is Distributors (Baroda) (P.) Ltd. v. Union of India authority for?

For computing the deduction under Section 80M, only the net dividend income (gross dividend income after reducing expenses attributable to earning it, as per Section 57(iii) and the principle in Section 80AB) is eligible. The case also holds that tax authorities are not bound to perpetuate an error from a previous assessment year, as each year is a separate unit and consistency cannot override substantive justice.

229

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2007 to 2026.

Also referred to as

Distributors (Baroda) (P.) Ltd. v. Union of India · 155 ITR 120 · Section 80M deduction · net dividend income · expenses attributable to dividend · Section 80AB · Section 57(iii) · consistency principle · perpetuate error · assessment year separate unit · judicial conscience · dividend income

Also reported as

1 SCC 4347 CTR 349

Sections most often in play

Section 143(3)Section 14ASection 153ASection 153DSection 1961Section 271(1)(c)Section 36(1)(vii)Section 40(a)(ia)

Issues it is cited on

section 274(2)section 50(1)section 80absection 80msection 243section 54esection 10(33)section 10(15)section 245hacasus omissussection 14a(1)section 54ec

Judgments citing Distributors (Baroda) (P.) Ltd. v. Union of India

M/S. Gujarat Cricket Association, Ahmedabad vs. The Jt.. Director of Income Tax (Exemption), Ahmedabad

In the result, ITA No. 2841/Ahd/17, i

ITA 3303/AHD/2016[2010-11]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2010-11
Section 11Section 2(15)

…in one year may not apply in the following year. Especially, when there have been changes in the provisions of concerned sections of the I.T. Act. Further the Hon'ble Supreme Court in the case of A Distributors (Baroda) Pvt. Ltd. vs Union of India and Others 155 ITR 120 has held that to perpetuate an error is not heroism, to rectify it, is the compulsion of the judicial conscience. 8.1 The CBDT had issued a circular No. 11 of 2008 dated 19/12/2008 wherein it has mentioned as follows :- "3. The newly inserted proviso to section 2 (15) will apply only to entities whose purpose is ' advancement of any other object…

Baroda Cricket Association, Baroda vs. The Dy.CIT, Circle-5., Baroda

In the result, ITA No. 2841/Ahd/17, i

ITA 337/AHD/2015[2011-12]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2011-12
Section 11Section 2(15)

…in one year may not apply in the following year. Especially, when there have been changes in the provisions of concerned sections of the I.T. Act. Further the Hon'ble Supreme Court in the case of A Distributors (Baroda) Pvt. Ltd. vs Union of India and Others 155 ITR 120 has held that to perpetuate an error is not heroism, to rectify it, is the compulsion of the judicial conscience. 8.1 The CBDT had issued a circular No. 11 of 2008 dated 19/12/2008 wherein it has mentioned as follows :- "3. The newly inserted proviso to section 2 (15) will apply only to entities whose purpose is ' advancement of any other object…

Baroda Cricket Association, Baroda vs. The Dy.CIT, Circle-5., Baroda

In the result, ITA No. 2841/Ahd/17, i

ITA 336/AHD/2015[2009-10]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2009-10
Section 11Section 2(15)

…in one year may not apply in the following year. Especially, when there have been changes in the provisions of concerned sections of the I.T. Act. Further the Hon'ble Supreme Court in the case of A Distributors (Baroda) Pvt. Ltd. vs Union of India and Others 155 ITR 120 has held that to perpetuate an error is not heroism, to rectify it, is the compulsion of the judicial conscience. 8.1 The CBDT had issued a circular No. 11 of 2008 dated 19/12/2008 wherein it has mentioned as follows :- "3. The newly inserted proviso to section 2 (15) will apply only to entities whose purpose is ' advancement of any other object…

Baroda Cricket Association, Baroda vs. The Jt. CIT, Range-5, Baroda

In the result, ITA No. 2841/Ahd/17, i

ITA 2957/AHD/2014[2010-11]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2010-11
Section 11Section 2(15)

…in one year may not apply in the following year. Especially, when there have been changes in the provisions of concerned sections of the I.T. Act. Further the Hon'ble Supreme Court in the case of A Distributors (Baroda) Pvt. Ltd. vs Union of India and Others 155 ITR 120 has held that to perpetuate an error is not heroism, to rectify it, is the compulsion of the judicial conscience. 8.1 The CBDT had issued a circular No. 11 of 2008 dated 19/12/2008 wherein it has mentioned as follows :- "3. The newly inserted proviso to section 2 (15) will apply only to entities whose purpose is ' advancement of any other object…

Gujarat Cricket Association, Ahmedabad vs. The Jt..Director of Income Tax(Exemption), Ahmedabad

In the result, ITA No. 2841/Ahd/17, i

ITA 1257/AHD/2013[2009-10]Status: DisposedITAT Ahmedabad24 Jan 2019AY 2009-10
Section 11Section 2(15)

…in one year may not apply in the following year. Especially, when there have been changes in the provisions of concerned sections of the I.T. Act. Further the Hon'ble Supreme Court in the case of A Distributors (Baroda) Pvt. Ltd. vs Union of India and Others 155 ITR 120 has held that to perpetuate an error is not heroism, to rectify it, is the compulsion of the judicial conscience. 8.1 The CBDT had issued a circular No. 11 of 2008 dated 19/12/2008 wherein it has mentioned as follows :- "3. The newly inserted proviso to section 2 (15) will apply only to entities whose purpose is ' advancement of any other object…

Shree Swami Samartha Developers, Mumbai vs. Principal Commissioner of Income Tax - Ward - 21, Mumbai

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

ITA 2969/MUM/2018[2013-14]Status: DisposedITAT Mumbai31 Oct 2018AY 2013-14

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

Section 143(3)Section 22Section 263

…IN THE INCOME TAX APPELLATE TRIBUNAL “G” Bench, Mumbai Before Shri B.R. Baskaran (AM) & Shri Ravish Sood(JM) I.T.A. No. 2969/Mum/2018 (Assessment Year 2013-14) Shree Swami Samartha PCIT-21 Developers Vs. Piramal Chambers 19-B, Suyash, Gokhale Parel Road North), Dadar (West) Mumbai-400 012. Mumbai-400 028. PAN : AABFS7754E (Appellant) (Respondent) Assessee by Shri Girish Dave & Shri Tanzil R. Padvekar Department by Shri K. Madhusudan Date of Hearing 25.09.2018 Date of Pronouncement 31.10.2018 O R D E R Per B.R. Baskaran (AM) :- The assessee has filed this appeal challenging the validity of the revision ord…

DCIT Cent. Cir. 7(1), Mumbai vs. Rare Enterprises, Mumbai

In the result, both the appeals of the revenue are dismissed

ITA 5208/MUM/2016[2013-14]Status: DisposedITAT Mumbai03 Oct 2018AY 2013-14

Bench: Shri B.R. Baskaran & Shri Pawan Singh

For Appellant: Ms. S. PadmajaFor Respondent: Shri S.C. Tiwari
Section 14Section 14ASection 2

…g funds towards making investments for earning of exempt income cannot be ruled out. These are valid inferences based on the facts of the case. In this connection, reliance is placed on the following judgements/decisions : (i) Distributors (Baroda) Pvt. Ltd. [155 ITR 120 (SC) (ii) Godrej Boyce & Mfg. Co. Ltd. vs. DCIT (234 CTR 1 (Bom) (iii) Magganlal Chagganlal Pvt. Ltd. [236 ITR 456 (Bom) (iv) M/s. Gherzi Eastern Limited (ITA No. 6562/Bom/94) dated 23rd September, 2002) (ITAT, Mumbai) In the case of Godrej Boyce & Mfg. Co. Ltd. vs. ACIT, the Hon'ble Bombay High Court has upheld the constitutional validity of Rul…

DCIT Cent. Cir. 7(1), Mumbai vs. Rare Enterprises, Mumbai

In the result, both the appeals of the revenue are dismissed

ITA 5207/MUM/2016[2012-13]Status: DisposedITAT Mumbai03 Oct 2018AY 2012-13

Bench: Shri B.R. Baskaran & Shri Pawan Singh

For Appellant: Ms. S. PadmajaFor Respondent: Shri S.C. Tiwari
Section 14Section 14ASection 2

…g funds towards making investments for earning of exempt income cannot be ruled out. These are valid inferences based on the facts of the case. In this connection, reliance is placed on the following judgements/decisions : (i) Distributors (Baroda) Pvt. Ltd. [155 ITR 120 (SC) (ii) Godrej Boyce & Mfg. Co. Ltd. vs. DCIT (234 CTR 1 (Bom) (iii) Magganlal Chagganlal Pvt. Ltd. [236 ITR 456 (Bom) (iv) M/s. Gherzi Eastern Limited (ITA No. 6562/Bom/94) dated 23rd September, 2002) (ITAT, Mumbai) In the case of Godrej Boyce & Mfg. Co. Ltd. vs. ACIT, the Hon'ble Bombay High Court has upheld the constitutional validity of Rul…

ACIT, Gurgaon vs. M/S. Motorola India Pvt. Ltd., Gurgaon

In the result, appeal filed by the revenue is dismissed

ITA 4581/DEL/2011[2004-05]Status: DisposedITAT Delhi24 Aug 2018AY 2004-05

Bench: Smt Diva Singh & Shri Prashant Maharishimotorola India Pvt Ltd, Vs. Acit, Motorola Excellence Centre, Gurgaon Circle, 415/2, Sector-14, Mg Road, Gurgaon Gurgaon, Haryana Pan: Aaacm9343D (Appellant) (Respondent) Acit, Vs. Motorola India Pvt Ltd, Gurgaon Circle, Motorola Excellence Centre, Gurgaon 415/2, Sector-14, Mg Road, Gurgaon, Haryana Pan: Aaacm9343D (Appellant) (Respondent) Motorola Solutions India (P) Ltd, Vs. Acit, 415/2, Motorola Excellence Gurgaon Circle, Centre, Mg Road, Haryana Gurgaon Pan: Aaacm9343D (Appellant) (Respondent) Acit, Vs. Motorola Solutions India (P) Gurgaon Circle, Ltd, Gurgaon 415/2, Motorola Excellence Centre, Mg Road, Haryana Pan: Aaacm9343D (Appellant) (Respondent) Assessee By : Shri G.C. Srivastava, Adv Shri Suvinay K. Dash, Adv Revenue By: Shri Sanjay I Bara, Cit Dr Date Of Hearing 28/05/2018 Date Of Pronouncement 24/08/2018

For Appellant: Shri G.C. Srivastava, AdvFor Respondent: Shri Sanjay I Bara, CIT DR
Section 37Section 43BSection 80HSection 92C

…" of the assessee under Explanation (baa) to section 80HHC. 11. For this interpretation of Explanation (baa) to section 80HHC of the Act, we rely on the judgment of the Constitution Bench of this court in Distributors (Baroda) P. Ltd. v. Union of India [1985] 155 ITR 120 (SC). Section 80M of the Act provided for deduction in respect of certain intercorporate dividends and it provided in sub-section (1) of section 80M that "where the gross total income of an assessee being a company includes any income by way of dividends received by it from a domestic company, there shall, in accordance with and subject to the pr…

Pravin Kumar Hetamsaria vs. ACIT, Cir-3, Asansol

Appeal is allowed

ITA 314/KOL/2015[2010-2011]Status: DisposedITAT Kolkata25 Jul 2018AY 2010-2011

Bench: Shri S.S.Godara & Dr. A.L. Sainiassessment Year :2010-11

Section 133(6)Section 143(3)

…atutory provision had not been brought to the notice of Court [Union of India & Anr. Vs. Raghubir Singh (SC) 178 ITR 548, Sri Agasthyar Trust vs. CIT 236 ITR 23] To perpetuate an error is no heroism [Distributors (Boaroda) P Ltd. Vs Union of India & ors. (SC) 155 ITR 120] ITA No.314/Kol/2015 A.Y. 2010-11 Pravin Kr. Hetasmsaria Vs. ACIT, Cir-3 Asl. Page 4 Tribunal need not blindly follow earlier decision of it if it did not reflect the correct position of law [CIT vs. Hi-Tech Arai Ltd. (Mad) 321 ITR 477]’ Thus filing of an incorrect return by Shri Shyam Sunder Hetamsaria in no way justifies allowing of a deductio…

The ACIT, Circle-6, Surat vs. Bardoli Vibhag Gram Vikas Co.Op.Credit Society Ltd., Surat

In the result, the appeal of the revenue is dismissed

ITA 2582/AHD/2014[2010-11]Status: DisposedITAT Surat22 Jun 2018AY 2010-11

Bench: Shri C.M.Garg & Shri O.P.Meenaआ.अ.सं./I.T.A No.2582/Ahd/2014/Srt िनधा"रण वष"/Assessment Year : 2010-11 Assistant Commissioner Of Vs. Bardoli Vibhag Gram Vikas Co- Income Tax, Operative Credit Society Ltd., Circle –6, Surat – 395001. Sardar Baug Bardoli, District Surat, Surat – 396 420 [Pan: Aaatb 8135 B] अपीलाथ" Appellant ""यथ"/Respondent Shri Mitish S. Modi, Ca िनधा"रती क" ओर से /Assessee By राज"व क" ओर से /Revenue By Shri Arvind Kumar Singh, Sr.Dr 20-06-2018 सुनवाई क" तारीख/ Date Of Hearing: 28-06-2018 उ"ोषणा क" तारीख/Pronouncement On आदेश /O R D E R Per O. P. Meena, Accoutant Member:

Section 143(2)Section 143(3)Section 80(2)(d)Section 80P

…ion u/s.80P(2)(d). It is not a case that appellant had either earned income or borrowed fund and invested in this investment and deposits…….. Further the A.O. considered Hon'ble Supreme Court decision in Distributors (Baroda) P. Ltd. Vs. Union of India [1985] 155 ITR 120 (SC), wherein, it was held that deduction u/s.80M is to be calculated with reference to amount on dividend computed in accordance with the provisions of the act and forming on the gross total income and not with reference to full amount of dividend received by the assessee. The Hon'ble Supreme Court decision is squarely applicable on deduction un…

ACIT, Ludhiana vs. M/S Vardhman Textiles Ltd., Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 575/CHANDI/2009[2005-06]Status: DisposedITAT Chandigarh04 May 2018AY 2005-06

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

M/S Vardhman Textiles Ltd., Ludhiana vs. Addl. CIT, Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 528/CHANDI/2009[2005-06]Status: DisposedITAT Chandigarh04 May 2018AY 2005-06

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

ACIT, Ludhiana vs. M/S Vardhman Textiles Ltd., Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 981/CHANDI/2008[2004-05]Status: DisposedITAT Chandigarh04 May 2018AY 2004-05

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

Vardhman Textiles Ltd., Ludhiana vs. JCIT, Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 938/CHANDI/2008[2004-05]Status: DisposedITAT Chandigarh04 May 2018AY 2004-05

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

ACIT, Ludhiana vs. M/S Vardhman Textiles Ltd., Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 530/CHANDI/2008[2003-04]Status: DisposedITAT Chandigarh04 May 2018AY 2003-04

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

Vardhman Textile Ltd., Ludhiana vs. ACIT, Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 475/CHANDI/2008[2003-04]Status: DisposedITAT Chandigarh04 May 2018AY 2003-04

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

ACIT, Ludhiana vs. Vardhman Textiles Ltd., Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 691/CHANDI/2007[2002-03]Status: DisposedITAT Chandigarh04 May 2018AY 2002-03

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

M/S Vardhman Textiles Ltd., Ludhiana vs. ACIT, Ludhiana

In the result appeals of the Assessee and the Revenue are partly allowed

ITA 681/CHANDI/2007[2002-03]Status: DisposedITAT Chandigarh04 May 2018AY 2002-03

Bench: Smt. Diva Singh & Dr. B.R.R. Kumarassessment Year: 2002-03

For Appellant: Shri. Subhash AggarwalFor Respondent: Sh. Ashish Abrol
Section 10BSection 14ASection 80H

…rmining the profits of the business under Explanation (baa) to Section 80HHC of the Act. 5. In support of this argument, learned counsel for the assessee relied on the decision of this Court inDistributors (Baroda) P. Ltd. v. Union of India and Others [(1985) 155 ITR 120] in which a Constitution Bench of this Court has held that only the dividends computed in accordance with the provisions of the Act, which is included in the gross total income of the domestic company, shall be taken into account for working out the relief under Section 80M of the Act. He cited the judgment in Commissioner of Income-Tax v. Shri R…

M/S. Kamakhaya Oil Company, New Delhi vs. CIT, New Delhi

In the result, appeal of the assessee is dismissed

ITA 3030/DEL/2014[2009-10]Status: DisposedITAT Delhi21 Nov 2017AY 2009-10

Bench: Sh. Bhavnesh Saini & Sh. O.P. Kantassessment Year: 2009-10 M/S. Kamakhaya Oil Company, Vs. Cit, Delhi-X, New Delhi C/O- M/S. Rra Taxindia, D-28, South Extension, Part-I, New Delhi. Pan : Aahfk3040R (Appellant) (Respondent) Appellant By Sh. R.S. Singhvi, Ca Respondent By Sh. Vijay Verma, Cit(Dr) Date Of Hearing 07.11.2017 Date Of Pronouncement 21.11.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 263Section 80I

…sistance to the assessee due to the reason that no evidences of stand taken by the Revenue in earlier year have been brought on record before us. Further, in view of the decision of Hon’ble Supreme Court in the case of Distributors (Baroda) Pvt. Ltd. Vs. UOI, 155 ITR 120 wherein, it was held that “to perpetuate an error is no heroism and to ratify it is the compulsion of judicial conscience”, we don’t find that the action of the ld. CIT is contrary to the law. Moreover, no such argument was taken before the ld. CIT by the assessee. 16 7.7 In view of our discussion above, we conclude that no enquiry of any kind w…