Godhra Electricity Co. Ltd. v. CIT

225 ITR 746Supreme Court of India1997#130 most cited

What is Godhra Electricity Co. Ltd. v. CIT authority for?

Income is not taxable until it actually accrues or is received; hypothetical income, based on a mere claim not yet settled, is not chargeable to tax.

514

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2009 to 2026.

Also referred to as

Godhra Electricity Co. Ltd. v. CIT · income accrual · hypothetical income · actual receipt · unconfirmed claims · income tax

Sections most often in play

Section 143(3)Section 147Section 148Section 14ASection 40A(3)Section 37(1)Section 142(2A)Section 153A

Issues it is cited on

section 10(31a)section 100section 76undisclosed foreign income and assetssection 142(2c)section 149(1)(c)section 4(2)section 153b(1)(b)section 201(3)section 158basection 153b(1)rectification under section 154

Judgments citing Godhra Electricity Co. Ltd. v. CIT

Varsha C Batra, Mumbai vs. ACIT Cen Cir 18 & 19, Mumbai

In the result, all the appeals filed by the revenue are dismissed

ITA 7770/MUM/2010[2007-08]Status: DisposedITAT Mumbai06 Jan 2016AY 2007-08

Bench: S/Shri B.R.Baskaran, Am & Amit Shukla, Jm आमकय अऩीर सं./I.T.A. No.7773/Mum/2010 (ननधधायण वषा / Assessment Year:2007-08) बनाम/ Chaturbhuj T Batra, Asstt.Commissioner Of Income 302, Pinnacle Tower, Tax Central Circle 18 & 19, Vs. 3Rd & 9Th Floor, Tps-Iii, Aayakar Bhavan, Khar (W), M K Road, Mumbai-400052 Mumbai-400020 (अऩीरधथी /Appellant) (प्रत्मथी / Respondent) .. आमकय अऩीर सं./I.T.A. No.8157/Mum/2010 (ननधधायण वषा / Assessment Year:2007-08) बनाम/ Asstt.Commissioner Of Chaturbhuj T Batra, Income Tax- 302, Pinnacle Tower, Vs. 3Rd Floor, 9Th Road, Tps-Iii, Central Circle 18 & 19, Khar (W), Room No.401, Mumbai-400052 4Th Floor, Aayakar Bhavan, M K Road, Mumbai-400020 (अऩीरधथी /Appellant) (प्रत्मथी / Respondent) .. स्थधमी रेखध सं./जीआइआय सं./Pan. :Aabpb3512F

Section 132

…Ltd to the assessees herein was furnished to the AO and the assessing officer has not brought any material above that mentioned in the statement. By placing reliance on the decision rendered by Hon’ble Supreme Court in the case of Godhra Electricity company (225 ITR 746)(SC), the Ld A.R contended that the assessing officer could assess only the real income has accrued or received or deemed to have been accrued or received. He submitted that the assessing officer has not brought any material to show that the income stated in the proforma invoices has accrued to the assessees herein. 12. Thus, we notice that the…

Kayagee Loparex India P.Ltd, Mumbai vs. ACIT (OSD) 8(1), Mumbai

ITA 7745/MUM/2012[2008-09]Status: DisposedITAT Mumbai28 Oct 2015AY 2008-09

Bench: S/Sh. Rajendra & Amit Shuklaआयकर आयकर अपील अपील संसंसंसं/.Ita No.7745 & 7746//Mum/2012,िनधा"रण िनधा"रण वष" वष"/Assessment Years-2008-09 & 2009-10 आयकर आयकर अपील अपील िनधा"रण िनधा"रण वष" वष" Kaygee Loparex India Pvt. Ltd. Acit(Osd) 8(1), B-28 Veera Ind. Estate,Bhukhanvala Vs Mumbai Chambers,Off Link Road, Andheri (W),Mumbai – 400 053 Pan: Aaack3962A (अपीलाथ" /Assessee) (""यथ" / Respondent) िनधा"रती िनधा"रती िनधा"रती ओर िनधा"रती ओर ओर सेसेसेसे/Assessee By ओर : Shri N. Jayendra राज"व क" ओर से/ Revenue By : Shri R.A. Dhyani सुनवाई सुनवाई सुनवाई क" सुनवाई क" क" तारीख क" तारीख तारीख / Date Of Hearing :20-10-2015 तारीख घोषणा क" तारीख / Date Of Pronouncement : 28-10-2015 आयकर आयकर अिधिनयम अिधिनयम,1961 1961 क" धारा क" धारा 254 254(1)के अ"तग"त आदेश के अ"तग"त आदेश आयकर आयकर अिधिनयम अिधिनयम क" धारा क" धारा के अ"तग"त आदेश के अ"तग"त आदेश 1961 1961 254 254 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 राजे"" के अनुसार लेखा सद"य राजे"" के अनुसार Challenging The Orders Dtd.23.10.2012And 29.10.2012 Of The Cit(A)-17,Mumbai,The Assessee Has Filed Appeals For The Abovementioned Two Assessment Years (Ays).During The Course Of Hearing Before Us The Authorised Representative(Ar)Fairly Conceded That Ground No.2 & 3 Are Covered Against The Assessee By The Decisions Of The Hon’Ble Supreme Court. Hence, Both The Grounds Stand Dismissed.

For Respondent: Shri R.A. Dhyani
Section 143(3)Section 254(1)

…आयकर आयकर आयकर अपीलीय आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, अिधकरण " ए” खंडपीठ खंडपीठ खंडपीठ मुंबई खंडपीठ मुंबई मुंबई मुंबई INCOME TAX APPELLATE TRIBUNAL,MUMBAI-“A”,BENCH सव"ी राजे"",लेखा सद"य एवं एवं एवं अिमत शु"ल,"याियक सद"य एवं Before S/Sh. Rajendra,Accountant Member & Amit Shukla,Judicial Member आयकर आयकर अपील अपील संसंसंसं/.ITA No.7745 & 7746//Mum/2012,िनधा"रण िनधा"रण वष" वष"/Assessment Years-2008-09 & 2009-10 आयकर आयकर अपील अपील िनधा"रण िनधा"रण वष" वष" Kaygee Loparex India Pvt. Ltd. ACIT(OSD) 8(1), B-28 Veera Ind. Estate,Bhukhanvala Vs Mumbai Chambers,Off link Road, Andheri (W),Mumbai – 400 05…

D.C.I.T. 3(1), Mumbai vs. Gns Outsourcing Pvt. Ltd., Mumbai

ITA 219/MUM/2013[2009-10]Status: DisposedITAT Mumbai21 Oct 2015AY 2009-10

Bench: Shri N.K. Billaiya & Shri Sanjay Gargआयकर अपील सं/ I.T.A. No.219/Mum/2013 ("नधा"रण वष" / Assessment Year:2009-10 बनाम/ The Dy. Cit, Circle 3(1), M/S. Gns Outsourcing Aayakar Bhavan, Pvt. Ltd., Vs. Mumbai-400 020 4Th Floor, Paville House, Twin Tower, Off Veer Savarkar Marg, Parabhadevi, Mumbai-400 025 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaach 0400Q (अपीलाथ" /Appellant) (""यथ" / Respondent) .. अपीलाथ" ओर से/ Appellant By: Shri Vachaspati Tripathi ""यथ" क" ओर से/Respondent By: Shri Dr. K. Shivaram सुनवाई क" तार"ख / Date Of Hearing : 8.10.2015 घोषणा क" तार"ख /Date Of Pronouncement :21 .10.2015 आदेश / O R D E R Per N.K. Billaiya, Am: This Appeal By The Revenue Is Preferred Against The Order Of The Ld. Cit(A)-7, Mumbai Dated 24.9.2012 Pertaining To Assessment Year 2009-10. 2. The Grievances Of The Revenue Read As Under:

For Appellant: Shri Vachaspati TripathiFor Respondent: Shri Dr. K. Shivaram

…the FAA was of the opinion that the principle amount itself was in doubt, there was no logic in crediting interest by the assessee. The FAA further drew support from the decisions of the Hon’ble Supreme Court in the case of Godhra Electricity Co. Ltd. Vs CIT 225 ITR 746 and CIT Vs Shoorji Vallabhdas and Co. 46 ITR 144 wherein the Hon’ble Apex Court has held that: “Income tax is levy on income. No doubt, the Income-tax Act takes into account two points of time at which the liability of tax 5 ITA. No.219/M/2013 is attracted viz., the accrual of income or its receipt, but the substance of the matter is the incom…

ACIT, New Delhi vs. Sh. Anil Kumar Sharma, New Delhi

In the result, the appeals of the Revenue as well as Cross

ITA 6204/DEL/2013[2010-11]Status: DisposedITAT Delhi23 Sept 2015AY 2010-11

Bench: Shri Chandra Mohan Garg & Shri L.P. Sahu

Section 127Section 132Section 139Section 143(3)Section 153ASection 2(24)(iv)

…for that matter? The very fact that the AO has gone into estimation, assumption and presumption establish that there is no real income and it is only the hypothetical income added by AO. The Hon’ble Apex Court in the case of Godhra Electricity Co. Ltd. (1997) 225 ITR 746 (SC) held that the computation of income is made in accordance with the method of accounting regularly employed by the assessee which may be cash system or mercantile system; however, in both cases unless there is real income, there cannot be any income tax. The aforesaid proposition with regard to real income theory was reaffirmed by Apex Court…

The Liquidator Polymerland India P.Ltd vs. The Deputy Commissioner of Income Tax

ITA - 268 / 2008HC Delhi19 May 2015

…n under the Income Tax Act, 1961 learned senior counsel relied upon the judgments of the Supreme Court in CIT V. Shoorji Vallabhdas & Co. (1962) 2015:DHC:4485-DB ITA 268/2008 & conn. Page 3 46 ITR 144 and Godhra Electricity Co. Ltd. V. CIT (1997) 225 ITR 746. It is emphasised that though the income tax enactment takes into account two points of time at which taxation liability is directed, i.e. accrual of income or its receipts, nevertheless the substance of the matter is income and if income does not result there cannot be tax. Learned senior counsel also relied upon the Supreme Court decisio…

The Liquidator Polymerland India P.Ltd vs. The Deputy Commissioner of Income Tax

ITA/268/2008HC Delhi19 May 2015

…n under the Income Tax Act, 1961 learned senior counsel relied upon the judgments of the Supreme Court in CIT V. Shoorji Vallabhdas & Co. (1962) 2015:DHC:4485-DB ITA 268/2008 & conn. Page 3 46 ITR 144 and Godhra Electricity Co. Ltd. V. CIT (1997) 225 ITR 746. It is emphasised that though the income tax enactment takes into account two points of time at which taxation liability is directed, i.e. accrual of income or its receipts, nevertheless the substance of the matter is income and if income does not result there cannot be tax. Learned senior counsel also relied upon the Supreme Court decisio…

CIT-I vs. M/S Malibu Estate P Ltd

ITA/213/2015HC Delhi18 Mar 2015
Section 260A

…d upon CIT vs. Shoorji Vallabhdas and 2015:DHC:2614-DB ITA 213/2015 Page 4 Co., (1962) 46 ITR 144 (SC) to highlight that income tax cannot be levied on hypothetical income. Likewise, the Court relied upon Godhra Electricity Co. Ltd. vs. CIT (1997) 225 ITR 746 (SC). The counsel stated that the three tests indicated in M/s. Excel Industries Limited (supra) would apply to the circumstances of this case given that the accountancy practices adopted by the assessee had been accepted earlier and that it was deemed to be the most appropriate for the activity in question. 7. In CIT vs. Manish Build Well…

Commissioner of Income Tax Delhi vs. M/S D.T.T.D.C. Ltd. New Delhi

Appeals are disposed of

ITA/166/2001HC Delhi20 Mar 2012

Bench: HON'BLE MR. JUSTICE SANJIV KHANNA,HON'BLE MR. JUSTICE R.V.EASWAR

For Respondent: ITAs 166/01, 161/04, 320/04 & ITR 30-33/1997
Section 256(1)Section 617

…of the profit and loss account. 28. The nature and character of the receipt has to be looked from practical and a commercial point of view (see R.B. Jodha Mal Kuthiala vs. CIT (1971) 82 ITR 570 (SC). 29. In Godhra Electricity Co. Ltd. vs. CIT, (1997) 225 ITR 746 (SC), reference was made to the following observations in CIT vs. Shoorji Vallabhdas & Co. (1962) 46 ITR 144 (SC): “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…

Airport Authority of India vs. Commissioner of Income Tax Delhi I

Appeals are disposed of in the aforesaid terms

ITA/792/2008HC Delhi16 Dec 2011

Bench: CASES PERTAINING TO FULL BENCHES

…* IN THE HIGH COURT OF DELHI AT NEW DELHI Judgment Reserved On: 2.12.2011 % Judgment Pronounced On: 16.12. 2011 + IT A 792/2008 AIRPORT AUTHORITY OF INDIA ... APPELLANT Through :. Mr. O.S. Bajpai, Sr. Advocate with Ms. Manasvini Bajpai and Mr. V.N. Jha, Advocates. VERSUS COMMISSIONER OF INCOME TAX ... RESPONDENT Through: Mr. Kamal Sawhney, Sr. Standing Counsel. CORAM:- HON'BLE THE ACTING CHIEF JUSTICE HON'BLE MR. JUSTICE RAJIV SHAKDHER HON'BLE MR. JUSTICE R.V. EASW AR A.K. SIKRI, ACTING CHIEF JUSTICE: For orders, see ITA 432/2008. DECEMBER 16, 2011 skb 1!;!':1~ ACTING CHIE; JUSTICE 7jwJ…

Airports Authority of India vs. Commissioner of Income Tax

Appeals are disposed of in the aforesaid terms

ITA - 432 / 2008HC Delhi16 Dec 2011

…ITA Nos.ITA 432/2008,433/2008,ITA 437/2008,ITA 517/2008 Page 1 of 26 ITA 792/2008,ITA 1250/2008,ITA 1251/2008 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 432 OF 2008 ITA 433 OF 2008 ITA 437 OF 2008 ITA 517 OF 2008 ITA 792 OF 2008 ITA 1250 OF 2008 ITA 1251 OF 2008 Judgment Reserved On: 2.12.2011 % Judgment Pronounced On:16.12.2011 (1) ITA 432/2008 AIRPORT AUTHORITY OF INDIA . . . APPELLANT Through :. Mr. O.S. Bajpai, Sr. Advocate with Ms. Manasvini Bajpai and Mr. V.N. Jha, Advocates. VERSUS C…

Commissioner of of Income Tax vs. Vishisth Chay Vyapar Limited

Appeals are dismissed

ITA - 1191 / 2007HC Delhi29 Nov 2010

…income and not any hypothetical/illusory income. In this behalf he referred to the following case law:- - (i) **UCO Bank** Vs. **CIT,** 237 ITR 889 (SC) - (ii) CIT Vs. Shoorji Vallabhdas and Co. 46 ITR 144 (SC) - (iii) Godhra Electricity Co Ltd. Vs. CIT 225 ITR 746 - 14. He also countered that applying the aforesaid principles, this Court has held that interest on sticky loans, where recovery of the principal was doubtful, could not be said to have accrued even under the mercantile system of accounting and, accordingly, such notional interest could not be taxed as income of the assessee. It was so held in t…

Commissioner of Income Tax vs. Eicher Ltd

ITA - 117 / 2010HC Delhi02 Jan 2010
Section 260

…income and not merely accrued income more so 'Wnen the principal amount is written off as bad debts in the subsequent years. The ITAT relied '-' upon, inter alia, the judgment of the Supreme Court in the case of Godhra ElecJricity Co. Ltd. Va. CIT (1997) 225 ITR 746 (SC) and judgment of this court in CIT Vs. Goyal M.G.Gases (P) Ltd. (ITA No. 538/2007 dated July 2, 2007). 3. The facts of the case are that the Assessing Officer made an addition of Rs.68,25,OOO/­ being the interest accrued on Inter Corporate Deposits given by the assessee to Mis Lottec Holdings (P) 2010:DHC:12058-DB • • accounting. T…

Commissioner of Income Tax vs. Eicher Ltd

ITA/431/2009HC Delhi15 Jul 2009

Bench: HON'BLE MR. JUSTICE A.K.SIKRI,HON'BLE MR. JUSTICE VALMIKI J. MEHTA

Section 260

…real income and not merely accrued income more so when the principal amount is written off as bad debts in the subsequent years. The ITAT relied upon, inter alia, the judgment of the Supreme Court in the case of Godhra Electricity Co. Ltd. Vs. CIT (1997) 225 ITR 746 (SC) and judgment of this court in CIT Vs. Goyal M.G.Gases (P) Ltd. (ITA No. 538/2007 dated July 2, 2007). 3. The facts of the case are that the Assessing Officer made an addition of Rs.68,25,000/- being the interest accrued on Inter Corporate Deposits given by the assessee to M/s Lottee Holdings (P) Ltd. The Assessing Officer observed tha…

Commissioner of Income Tax vs. Eicher Ltd

ITA - 431 / 2009HC Delhi15 Jul 2009
Section 260

…real income and not merely accrued income more so when the principal amount is written off as bad debts in the subsequent years. The ITAT relied upon, inter alia, the judgment of the Supreme Court in the case of Godhra Electricity Co. Ltd. Vs. CIT (1997) 225 ITR 746 (SC) and judgment of this court in CIT Vs. Goyal M.G.Gases (P) Ltd. (ITA No. 538/2007 dated July 2, 2007). 3. The facts of the case are that the Assessing Officer made an addition of Rs.68,25,000/- being the interest accrued on Inter Corporate Deposits given by the assessee to M/s Lottee Holdings (P) Ltd. The Assessing Officer observed tha…