D’Souza, Mangaluru Page 33 of 41 CIT(Bom) 137 ITR 58; Assam Pesticides &Agro Chemicals v. CIT(Gau)

227 ITR 846High Court1997#3565 most cited

What is D’Souza, Mangaluru Page 33 of 41 CIT(Bom) 137 ITR 58; Assam Pesticides &Agro Chemicals v. CIT(Gau) authority for?

Expenditure is deductible under section 37 only if it is incurred wholly and exclusively for the purpose of business. The mere fact that a payment is made under a contract does not conclusively establish it as a business expense.

33

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2016 to 2024.

Also referred to as

D'Souza Mangaluru · Assam Pesticides · section 37 · expenditure incurred wholly and exclusively for business · contract payment business expense · business expediency

Sections most often in play

Section 37Section 80ICSection 143(2)Section 271(1)(c)Section 274Section 80IBSection 10CCBSection 143(3)

Issues it is cited on

section 80ib(4)section 153a proceedingsexplanation to section 37section 158bdgoing concernprohibited by lawbusiness expediencyinitial assessment yearsection 246section 30section 80icsection 246a

Judgments citing D’Souza, Mangaluru Page 33 of 41 CIT(Bom) 137 ITR 58; Assam Pesticides &Agro Chemicals v. CIT(Gau)

M/S Sudarshan Paper & Board Pvt.Ltd., Kolkata vs. DCIT, Cir-4, Kolkata

In the result, ITA No. 1266/Kol/2016, is allowed

ITA 1266/KOL/2016[2010-2011]Status: DisposedITAT Kolkata09 Nov 2018AY 2010-2011

Bench: Sri J. Sudhakar Reddy & Sri S.S. Viswanethra Ravi]

Section 131Section 133(6)

…e ground that the assessee could not prove the services rendered by these commission agents. He relied on the following judgments:- a) Vishnu Agencies P. Ltd.; Calcutta High Court (117 ITR 823) b) Assam Pesticides and Agro Chemical; Gauhati High Court (1997) (227 ITR 846) c) Lachminarayan Madanlal; Hon’ble Supreme Court (1972) (86 ITR 439) 3.1. On appeal, for the Assessment Year 2011-12, the ld. CIT(A) deleted the addition by observing as under:- “7.4. All the commission agents barring one appeared before the AO confirmed about receipt of commission and filed details of services rendered; bills were raised by th…

Shivalik Ventures P. Ltd, Mumbai vs. DCIT (OSD-1), Mumbai

In the result, appeal of the Revenue is dismissed and the appeal of the

ITA 5407/MUM/2015[2012-13]Status: DisposedITAT Mumbai19 Sept 2018AY 2012-13

Bench: Shri B.R. Baskaran & Shri Pawan Singhm/S Shivalik Ventures Pvt. Ltd. Acit Cc-4(2), Plot No. 756, Staney Fernandes Aayakar Bhavan, .M. K. Road, Wadi, D S Babrekar Marg, Vs. Mumbai-400020. Dadar (W), Mumbai-400028. Pan: Aalcs7683R Appellant Respondent Acit Cc-4(2), M/S Shivalik Ventures Pvt. Ltd. Aayakar Bhavan, .M. K. Road, Plot No. 756, Staney Fernandes Mumbai-400020. Vs. Wadi, D S Babrekar Marg, Dadar (W), Mumbai-400028. Pan: Aalcs7683R Appellant Respondent Appellant By : Shri Vijay Mehta, Anuj Kisnadwala (Ar) Respondent By : Shri Manjunatha Swamy (Cit-Dr), Rajeev Gubgotra Date Of Hearing : 31.08.2018 Date Of Pronouncement : 19.09.2018 Orderunder Section 254(1)Of Income Tax Act Per Pawan Singh; 1. These Cross Appeals Filed Under Section 253 Of The Act Are Directed Against

For Appellant: Shri Vijay Mehta, Anuj Kisnadwala (AR)For Respondent: Shri Manjunatha Swamy (CIT-DR), Rajeev Gubgotra
Section 132Section 143(3)Section 253Section 254(1)

…sions (a) Embassy Classic P Ltd vs. ACIT (7 ITR (T) 287)(Bang.) (b) Maddi Venkatraman & Co. Vs CIT (SC dated 02.12.1997) (c) Indian Aluminum Company Vs CIT (AIR 1972 SC1880) (d) CIT Vs Nainital Bank Ltd (AIR 1965 SC 1227) (e) Assam Pesticides and Agro Vs CIT (227 ITR 846) (Gau). 10. In the rejoinder, the Ld A.R submitted that the assessee has paid the advance amount of Rs.15 crores in the year 2008 and till date nothing has been received back. No further development has also taken place. He further submitted that M/s Sai Lee Developers/infotech are not related parties in order to doubt the genuineness of the dea…

Sai Flipped Coils Ltd., Gandhinagar vs. The Income Tax Officer, Ward-4(1)(1) (Old: Dy.CIT, Circle-8), Ahmedabad

In the result, both the appeals of the assessee are partly allowed

ITA 396/AHD/2016[2011-12]Status: DisposedITAT Ahmedabad04 Sept 2018AY 2011-12

Bench: Shri Mahavir Prasad & Shri Waseem Ahmedआयकर अपील सं./I.T.A. Nos. 395 To 396/Ahd/2016 ("नधा"रण वष"/Assessment Years :2010-11 & 2011-12) Sai Flipped Coils Ltd., Ito, बनाम/ 75/B, Santej Vadsar Road, Ward – (4)(1)(1), Vs. Santej, Ahmedabad. Gandhinagar – 382 721 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aahcs 0475 P .. (अपीलाथ"/Appellant) (""यथ" / Respondent) Shri Tushar Hemani & Parimal Parmar, अपीलाथ" ओर से/ Appellant By : A.R. ""यथ" क" ओर से/Respondent By: Shri Mudit Nagpal, Sr. D.R.

For Respondent: Shri Mudit Nagpal, Sr. D.R
Section 2(24)(x)Section 36(1)(va)Section 43B

…he expenditure. It is trite law, and therefore the deduction for the expense cannot be allowed merely on the basis of payment. The AO in support of his claim relied on the order of Hon’ble Gauhati High Court in the case of Assam Pesticides vs. CIT reported in 227 ITR 846. In view of the above, the AO held that the assessee has not substantiated the payment of commission. Therefore, the same was disallowed and added back to the total income of the assessee. 8. Aggrieved, assessee preferred an appeal to ld. CIT(A) who confirmed the order of AO on the ground that the services rendered by the commission agents remai…

Sai Flipped Coils Ltd., Gandhinagar vs. The Income Tax Officer, Ward-4(1)(1) (Old: Dy.CIT, Circle-8), Ahmedabad

In the result, both the appeals of the assessee are partly allowed

ITA 395/AHD/2016[2010-11]Status: DisposedITAT Ahmedabad04 Sept 2018AY 2010-11

Bench: Shri Mahavir Prasad & Shri Waseem Ahmedआयकर अपील सं./I.T.A. Nos. 395 To 396/Ahd/2016 ("नधा"रण वष"/Assessment Years :2010-11 & 2011-12) Sai Flipped Coils Ltd., Ito, बनाम/ 75/B, Santej Vadsar Road, Ward – (4)(1)(1), Vs. Santej, Ahmedabad. Gandhinagar – 382 721 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aahcs 0475 P .. (अपीलाथ"/Appellant) (""यथ" / Respondent) Shri Tushar Hemani & Parimal Parmar, अपीलाथ" ओर से/ Appellant By : A.R. ""यथ" क" ओर से/Respondent By: Shri Mudit Nagpal, Sr. D.R.

For Respondent: Shri Mudit Nagpal, Sr. D.R
Section 2(24)(x)Section 36(1)(va)Section 43B

…he expenditure. It is trite law, and therefore the deduction for the expense cannot be allowed merely on the basis of payment. The AO in support of his claim relied on the order of Hon’ble Gauhati High Court in the case of Assam Pesticides vs. CIT reported in 227 ITR 846. In view of the above, the AO held that the assessee has not substantiated the payment of commission. Therefore, the same was disallowed and added back to the total income of the assessee. 8. Aggrieved, assessee preferred an appeal to ld. CIT(A) who confirmed the order of AO on the ground that the services rendered by the commission agents remai…

Yami Associates, Rajnandgaon vs. I.T.O.-1, Rajnandgaon

In the result, the appeal is dismissed

ITA 127/BIL/2015[2009-10]Status: DisposedITAT Raipur25 May 2018AY 2009-10

Bench: Shri N.K. Billaiya (Am) & Shri Ram Lal Negi (Jm) Assessment Year: 2009-10 M/S Yami Associates, The Income Tax Officer-I, Yalsco Carrier Building, F.C.I. Road, Near Raipur Naka, Ridhi Sidhi Colony, Rajnandgaon (C.G.) Rajnandgaon (C.G.) Vs. Pan: Aaafy7073P (Appellant) (Respondent) Assessee By : None Revenue By : Shri D.K. Jain (Dr) Date Of Hearing: 08/03/2018 Date Of Pronouncement: 25/05/2018

For Appellant: NoneFor Respondent: Shri D.K. Jain (DR)
Section 143

…d out wholly and exclusively for the purpose of business as has been held in plethora of cases like CIT Vs. Kolkata Agencies Limited 19 ITR 191 (SC), Lakshimaratan Cotton Mills Co. Ltd. Vs. CIT 73 ITR 634 (SC), Assam Pesticides & Agro Chemicals Vs. CIT (Gau). 227 ITR 846, Goodlas Nerolac Paints Ltd. Vs. CIT (Bom) 137 ITR 58. In case expenses are not supported by proper bills and vouchers, reasonable addition can be made out of partial disallowance of expenses, though books of accounts are audited and auditor has not made any adverse comment as held in Goodyear India Ltd. Vs. CIT 246 ITR 116, Shri Khushal Prasad M…

Flat World Processes P.Ltd, Mumbai vs. ITO 8(1)(4), Mumbai

In the result this appeal by the assessee stands dismissed

ITA 56/MUM/2016[2011-12]Status: DisposedITAT Mumbai25 May 2018AY 2011-12

Bench: Shri Shamim Yahya & Shri Pawan Singhआयकर अपीऱ सं./I.T.A. No.56/Mum/2016 (नििाारण वर्ा / Assessment Year: 2011-12) बिाम/ M/S. Flat World Processes P. Ito-8(1)(4) Ltd., 30 Level-3, Ceejay House, F-Block, Shiv Sagar V. Estate, Dr. Annie Besant Road, Worli, Mumbai-400018 स्थायी ऱेखा सं./ Pan : Aabcf1764G (अपीऱाथी /Appellant) (प्रत्यथी / Respondent) ..

For Appellant: Namrit ChandheriFor Respondent: Pooja Swaroop
Section 131Section 133(6)

…आयकर अपीऱीय अधिकरण “F” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, JUDICIAL MEMBER AND SHRI PAWAN SINGH, ACCOUNTANT MEMBER आयकर अपीऱ सं./I.T.A. No.56/Mum/2016 (नििाारण वर्ा / Assessment Year: 2011-12) बिाम/ M/s. Flat World Processes P. ITO-8(1)(4) Ltd., 30 Level-3, Ceejay House, F-Block, Shiv Sagar v. Estate, Dr. Annie Besant Road, Worli, Mumbai-400018 स्थायी ऱेखा सं./ PAN : AABCF1764G (अपीऱाथी /Appellant) (प्रत्यथी / Respondent) .. Assessee by: Namrit Chandheri Revenue by : Pooja Swaroop सुनवाई की तारीख /Date of Hearing : 15-03-2018 घोषणा की तारीख /Da…

M/S Shree Bishandas Iron Works, Kolkata vs. The DCIT Cir-36, Kolkata

In the result, assessee’s appeal stands allowed

ITA 1232/KOL/2014[2008-2009]Status: DisposedITAT Kolkata26 Dec 2017AY 2008-2009

Bench: Shri Waseem Ahmed & Shri S.S.Viswanethra Raviassessment Year:2008-09 M/S Shree Bishandas Iron Dcit, Circle- बनाम Works, 4 India Exchange 36,Kolkata / V/S. Place, 2Nd Floor, Kolkta-001 [Pan No.Aanfs0164 Q] .. अपीलाथ" /Appellant ""यथ" /Respondent Shri Ravi Tulsiyan, Fca अपीलाथ" क" ओर से/By Appellant Shri Saurbh Kumar, Addl. Cit-Dr ""यथ" क" ओर से/By Respondent 02-11-2017 सुनवाई क" तार"ख/Date Of Hearing घोषणा क" तार"ख/Date Of Pronouncement 26-12-2017 आदेश /O R D E R Per Waseem Ahmed:- This Appeal By The Assessee Is Directed Against The Order Of Commissioner Of Income Tax (Appeals)-Xix, Kolkata Dated 09.04.2014. Assessment Was Framed By Dcit, Circle-36, Kolkata U/S 143(3) Of The Income Tax Act, 1961 (Hereinafter Referred To As ‘The Act’) Vide His Order Dated 31.12.2010 For Assessment Year 2008-09. Shri Ravi Tulsiyan, Ld. Authorized Representative Appeared On Behalf Of Assessee & Shri Surbh Kumar, Ld. Departmental Representative Appeared On Behalf Of Revenue. 2. Sole Issue Raised By Assessee In This Appeal Is That Learned Cit(A) Erred In Confirming The Order Of Ao By Sustaining The Disallowance Of Rs. 1,17,47,513 On Account Of Commission Expenses Claimed By The Assessee. 3. Briefly Stated Facts Are That The Assessee In The Present Case Is A Partnership Firm & Engaged In The Business Of Manufacturing & Trading Of Iron & Steel Materials.

Section 131Section 133(6)Section 143(3)

…tion and it was for the assessee to adduce evidence to show that services, if any, were rendered by the ole selling agents. Similar view has been taken by their Lordships of the Gauhati High Court in the case of Assam Pesticides & Agro Chemicals v. CIT (1977) 227 ITR 846. Their Lordships held:- ‘mere payment by itself would not entitle an assessee for deduction of the said expenditure unless the same was proved to be paid for commercial consideration. The onus of proof at all relevant times rests upon the assessee. The law does not prescribe any quantitative test to find out whether the onus in a particular case…

V & V Pharma Industries, Thane vs. ACIT Cir. 3, Thane

In the result , appeal of the assessee in ITA no

ITA 6056/MUM/2016[2010-11]Status: DisposedITAT Mumbai28 Nov 2017AY 2010-11

Bench: Shri Saktijit Dey & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No. 6056 & 6057/Mum/2016 (नििाारण वर्ा / Assessment Year : 2010-11 & 2011-12)

For Appellant: Shri. Deepak RajeFor Respondent: Ms. Pooja Swaroop
Section 139(1)Section 143(3)Section 145(3)Section 69C

…e is justified. The law does not prescribe any quantitative test to find outwhether the onus in a particular case has been duly discharged. It all depends on the facts and circumstances / situations of the case [Assam Pesticides & Agro Chemicals V. CIT (1997) 227 ITR 846, 851, 852 (Gauh)]. - . Mere payment by A/c Payee Cheque is not sacrosanct it would not make otherwise non- genuine transaction genuine. CIT Vis. Precision Finance Pvt. Ltd. 208 ITR 465 (Cal). Even in the case of M/s. Kanchwala Gems Vis JCIT upheld by SC 288 ITR 10 (SC), Hon'ble ITAT had held that even Account Payee Cheque is not sufficient to est…

Etesh Prakash Jain (HUF), Bhiwandi vs. ITO, WD-1(1), Kalyan

In the result, appeal of revenue is dismissed whereas appeal of assessee is allowed in part

ITA 3021/MUM/2016[2009-10]Status: DisposedITAT Mumbai24 Oct 2017AY 2009-10

Bench: Shri R.C.Sharma, Am & Shri Sandeep Gosain, Jm Ito Wd 1(1), Vs. Etesh P. Jain Huf It Office, 1St Floor, Mohan M/S. Shree Darshan Pipes, Plaza, Wayale Nagar 331/5, Surya Darshan Kalyan West, Building, Kasar Ali Kalyan Gokul Nagar Bhiwandi – 421 302 Pan/Gir No. Aaahe1478G Appellant) .. Respondent) Etesh P. Jain Huf Vs. Ito Wd 1(1), It Office, 1St Floor, Mohan M/S. Shree Darshan Pipes, 331/5, Surya Darshan Plaza, Wayale Nagar Building, Kasar Ali Kalyan West, Gokul Nagar Kalyan Bhiwandi – 421 302 Pan/Gir No. Aaahe1478G Appellant) .. Respondent) Revenue By Ms. Arju Garodia Assessee By Shri A.T.Jain

Section 143(1)Section 143(3)Section 145(3)

…is justified. The law does not prescribe any quantitative test to find out whether the onus in a particular case has been duly discharged. It all depends on the facts and circumstances / situations of the case [Assam Pesticides & Agro Chemicals V. CIT (1997) 227 ITR 846, 851, 852 (Gauh)]. - Mere payment by A/c Payee Cheque is not sacrosanct it would not make otherwise non-genuine transaction genuine. CIT V/s. Precision Finance Pvt. Ltd. 208 ITR 465 (Cal). - Even in the case of M/s. Kanchwala Gems V/s JCIT upheld by SC 288 ITR 10 (SC), Hon'ble ITAT had held that even Account Payee Cheque is not sufficient to esta…

M/S Parag Fans & Cooling Systems Ltd., Dewas vs. The ACIT 1(1), Ujjain

In the result, the appeal of the assessee is allowed

ITA 372/IND/2015[2011-12]Status: DisposedITAT Indore11 Aug 2017AY 2011-12

Bench: Shri C.M. Garg & Shri O.P.Meena

Section 37

…lish the commercial expediency and the expenditure was incurred wholly and exclusively for business purposes is terms of ratio laid down in the case of Goodlas Nerolac Paints Ltd. V/s CIT (Bom)s 137 ITR 53 and Assam Pesticides & Agro Chemicals Vs. CIT (Gau) 227 ITR 846 and from mere making an agreement and debiting an expenditure on which the assessee has failed to establish the business compulsion, hence, expenditure is not allowable. Therefore the AO concluded that the assessee has adopted a modus operandi to reduce its profitability by way of making an agreement with the Director’s company in which no M/s. P…

ITO WD 1(5), Kalyan vs. Gopal Ramshish Tripathi, Bhiwandi

In the result, the appeal for all three years, are PARTLY

ITA 6559/MUM/2016[2011-12]Status: DisposedITAT Mumbai18 Apr 2017AY 2011-12

Bench: Shri R.C.Sharma, Am

Section 143(3)Section 145(3)Section 148Section 69C

…is justified. The law does not prescribe any quantitative test to find out whether the onus in a particular case has been duly discharged. It all depends on the facts and circumstances I situations of the case [Assam Pesticides & Agro Chemicals V. CIT (1997) 227 ITR 846, 851, 852 (Gauh). - Mere payment by A/c Payee Cheque is not sacrosanct it would root make otherwise non-genuine transaction genuine. CIT Vis. Precision Finance Pvt. Ltd. 208 ITR 465 (Cal). CO No.61 & 62/Mum/2017 Gopal Ramshish Tripathi - Even in the case of M/s. Kanchwala Gems VIs JCIT upheld by SC 288 ITR 10 (SC), Hon'ble ITA T had held that ev…

M/S. Stock Traders Pvt. Ltd., Mumbai vs. ACIT Cir 2(3), Mumbai

In the result, the appeal for the assessment year 1995-96 is dismissed

ITA 2803/MUM/2003[1996-1997]Status: DisposedITAT Mumbai05 Apr 2016AY 1996-1997
Section 143(3)Section 250

…e of such agreement/payment, it is open to the ITO to consider the relevant facts and determined for himself whether the commission said to have been paid is properly deductible u/s. 37(1). In the case of Assam Pesticides and Agro Chemicals Vs. CIT (Guwahati) 227 ITR 846 the Hon'ble Court has held that mere payment by itself would not entitle an assessee for deduction of the said expenditure unless the same was proved to be paid for commercial considerations. The onus of proof at all relevant times rest upon the assessee. In the case of Swadeshi Cotton Mills 63 ITR 57 (SC) the Apex ITA Nos.2802, 2803 & 2088/Mum/…

M/S. Stock Traders Pvt. Ltd., Mumbai vs. ACIT Cir 2(3), Mumbai

In the result, the appeal for the assessment year 1995-96 is dismissed

ITA 2802/MUM/2003[1995-1996]Status: DisposedITAT Mumbai05 Apr 2016AY 1995-1996
Section 143(3)Section 250

…e of such agreement/payment, it is open to the ITO to consider the relevant facts and determined for himself whether the commission said to have been paid is properly deductible u/s. 37(1). In the case of Assam Pesticides and Agro Chemicals Vs. CIT (Guwahati) 227 ITR 846 the Hon'ble Court has held that mere payment by itself would not entitle an assessee for deduction of the said expenditure unless the same was proved to be paid for commercial considerations. The onus of proof at all relevant times rest upon the assessee. In the case of Swadeshi Cotton Mills 63 ITR 57 (SC) the Apex ITA Nos.2802, 2803 & 2088/Mum/…