India Cements Ltd. v. CIT

60 ITR 52Supreme Court of India1966#350 most cited

What is India Cements Ltd. v. CIT authority for?

Expenses incurred for obtaining a loan for the purpose of the assessee's business, such as debenture discount, bank guarantee charges, and stamp duty, are considered revenue expenditure. These liabilities, though potentially spread over time, are deductible as revenue expenses.

247

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2008 to 2026.

Also referred to as

India Cements Ltd. v. CIT · 60 ITR 52 · Section 37(1) · revenue expenditure · expenses for obtaining loan · cost of raising finance · debenture discount · bank guarantee charges · stamp duty on loan · commercial expediency

Sections most often in play

Section 1961Section 37(1)Section 37Section 143(3)Section 142(1)Section 115JBSection 14ASection 40A(2)(b)

Issues it is cited on

section 35dsection 135commercial expediencydisallowance of interest expendituresection 139(5)section 40a(2)(b)revenue expendituresection 92bsection 36(1)(iii)section 244acorporate guaranteeenduring benefit

Judgments citing India Cements Ltd. v. CIT

ACIT, New Delhi vs. M/S. Cosmo Films Ltd., New Delhi

In the result, the appeal for A

ITA 5038/DEL/2013[2004-05]Status: DisposedITAT Delhi26 Jul 2023AY 2004-05

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Shri T. James Singson, CIT- DR
Section 10BSection 43(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘B’ BENCH, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No. 5038/DEL/2013 [A.Y. 2004-05] ITA No. 5039/DEL/2013 [A.Y. 2005-06] ITA No. 5040/DEL/2013 [A.Y. 2006-07] ITA No. 2844/DEL/2012 [A.Y. 2007-08] ITA No. 6504/DEL/2013 [A.Y. 2008-09] The A.C.I.T Vs. M/s Cosmo Films Ltd Circle - 3(1) 1008, DLF Tower A New Delhi Jasola District Centre New Delhi PAN: AAACC 1152 C (Applicant) (Respondent) Assessee By : Dr. Rakesh Gupta, Adv Shri Somil Agarwal, Adv Department By : Shri T. James Singson, CIT- DR Shri Vivek Kum…

ACIT, New Delhi vs. M/S. Cosmo Films Ltd., New Delhi

In the result, the appeal for A

ITA 6504/DEL/2012[2008-09]Status: DisposedITAT Delhi26 Jul 2023AY 2008-09

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Shri T. James Singson, CIT- DR
Section 10BSection 43(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘B’ BENCH, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No. 5038/DEL/2013 [A.Y. 2004-05] ITA No. 5039/DEL/2013 [A.Y. 2005-06] ITA No. 5040/DEL/2013 [A.Y. 2006-07] ITA No. 2844/DEL/2012 [A.Y. 2007-08] ITA No. 6504/DEL/2013 [A.Y. 2008-09] The A.C.I.T Vs. M/s Cosmo Films Ltd Circle - 3(1) 1008, DLF Tower A New Delhi Jasola District Centre New Delhi PAN: AAACC 1152 C (Applicant) (Respondent) Assessee By : Dr. Rakesh Gupta, Adv Shri Somil Agarwal, Adv Department By : Shri T. James Singson, CIT- DR Shri Vivek Kum…

ACIT, New Delhi vs. M/S. Cosmo Films Ltd., New Delhi

In the result, the appeal for A

ITA 2844/DEL/2012[2007-08]Status: DisposedITAT Delhi26 Jul 2023AY 2007-08

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Shri T. James Singson, CIT- DR
Section 10BSection 43(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘B’ BENCH, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No. 5038/DEL/2013 [A.Y. 2004-05] ITA No. 5039/DEL/2013 [A.Y. 2005-06] ITA No. 5040/DEL/2013 [A.Y. 2006-07] ITA No. 2844/DEL/2012 [A.Y. 2007-08] ITA No. 6504/DEL/2013 [A.Y. 2008-09] The A.C.I.T Vs. M/s Cosmo Films Ltd Circle - 3(1) 1008, DLF Tower A New Delhi Jasola District Centre New Delhi PAN: AAACC 1152 C (Applicant) (Respondent) Assessee By : Dr. Rakesh Gupta, Adv Shri Somil Agarwal, Adv Department By : Shri T. James Singson, CIT- DR Shri Vivek Kum…

Add. CIT Spl Range--3, New Delhi vs. Dlf Ltd, New Delhi

ITA 5919/DEL/2019[2016-17]Status: DisposedITAT Delhi19 Jul 2023AY 2016-17

Bench: Sh. N.K.Billaiya & Sh. Anubhav Sharmaita No.5978/Del/2017, A.Y. 2014-15 Ita No.2238/Del/2019, A.Y. 2015-16 Ita No.5919/Del/2019, A.Y. 2016-17

Section 143(3)Section 14ASection 801A

…l asset. According to the Commissioner, since the loan was raised on securing capital asset, the interest incurred thereon constituted part of capital expenditure. This finding of the Commissioner was erroneous. In the case of India Cements Ltd. v. CIT [1966] 60 ITR 52 , if was held by the Supreme Court that in cases where the act of borrowing was incidental to carrying on of business, the loan obtained was not an asset. That, for the purposes of deciding the claim of deduction under section 10(2){iii) of the Income-tax Act, 1922 [section 36(1){iii) of the present Income-tax Act], it was irrelevant to consider th…

Add. CIT Spl Range--3, New Delhi vs. Dlf Ltd, New Delhi

ITA 2238/DEL/2019[2015-16]Status: DisposedITAT Delhi19 Jul 2023AY 2015-16

Bench: Sh. N.K.Billaiya & Sh. Anubhav Sharmaita No.5978/Del/2017, A.Y. 2014-15 Ita No.2238/Del/2019, A.Y. 2015-16 Ita No.5919/Del/2019, A.Y. 2016-17

Section 143(3)Section 14ASection 801A

…l asset. According to the Commissioner, since the loan was raised on securing capital asset, the interest incurred thereon constituted part of capital expenditure. This finding of the Commissioner was erroneous. In the case of India Cements Ltd. v. CIT [1966] 60 ITR 52 , if was held by the Supreme Court that in cases where the act of borrowing was incidental to carrying on of business, the loan obtained was not an asset. That, for the purposes of deciding the claim of deduction under section 10(2){iii) of the Income-tax Act, 1922 [section 36(1){iii) of the present Income-tax Act], it was irrelevant to consider th…

Addl. CIT, Special Range- 03, New Delhi vs. Dlf Ltd., New Delhi

ITA 5978/DEL/2017[2014-15]Status: DisposedITAT Delhi19 Jul 2023AY 2014-15

Bench: Sh. N.K.Billaiya & Sh. Anubhav Sharmaita No.5978/Del/2017, A.Y. 2014-15 Ita No.2238/Del/2019, A.Y. 2015-16 Ita No.5919/Del/2019, A.Y. 2016-17

Section 143(3)Section 14ASection 801A

…l asset. According to the Commissioner, since the loan was raised on securing capital asset, the interest incurred thereon constituted part of capital expenditure. This finding of the Commissioner was erroneous. In the case of India Cements Ltd. v. CIT [1966] 60 ITR 52 , if was held by the Supreme Court that in cases where the act of borrowing was incidental to carrying on of business, the loan obtained was not an asset. That, for the purposes of deciding the claim of deduction under section 10(2){iii) of the Income-tax Act, 1922 [section 36(1){iii) of the present Income-tax Act], it was irrelevant to consider th…

DCIT, Circle- 21(1), New Delhi vs. Religare Finvest Ltd., New Delhi

In the result, -Appeal in ITA No

ITA 7553/DEL/2018[2015-16]Status: DisposedITAT Delhi13 Jul 2023AY 2015-16

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

Religare Finvest Ltd., New Delhi vs. DCIT, Circle- 21(1), New Delhi

In the result, -Appeal in ITA No

ITA 6116/DEL/2018[2015-16]Status: DisposedITAT Delhi13 Jul 2023AY 2015-16

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

Religare Finvest Ltd., New Delhi vs. DCIT, Circle- 21(1), New Delhi

In the result, -Appeal in ITA No

ITA 547/DEL/2018[2013-14]Status: DisposedITAT Delhi13 Jul 2023AY 2013-14

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

ACIT (OSD), Circle- 21(1), New Delhi vs. Religare Finvest Ltd., New Delhi

In the result, -Appeal in ITA No

ITA 133/DEL/2018[2014-15]Status: DisposedITAT Delhi13 Jul 2023AY 2014-15

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

Religare Finvest Ltd., New Delhi vs. ACIT, Circle- 21(1), New Delhi

In the result, -Appeal in ITA No

ITA 7856/DEL/2017[2014-15]Status: DisposedITAT Delhi13 Jul 2023AY 2014-15

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

ACIT, Circle- 21(1), New Delhi vs. Religare Finvest Ltd., New Delhi

In the result, -Appeal in ITA No

ITA 5202/DEL/2017[2012-13]Status: DisposedITAT Delhi13 Jul 2023AY 2012-13

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

Religare Finvest Ltd., New Delhi vs. DCIT, Circle- 21(1), New Delhi

In the result, -Appeal in ITA No

ITA 4796/DEL/2017[2012-13]Status: PendingITAT Delhi13 Jul 2023AY 2012-13

Bench: Dr. B. R. R. Kumar & Shri Yogesh Kumar U.S.

Section 14A

…le . 26. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd.v. CIT [1966] 60 ITR 52. The question before us however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius Company under the Investor Agreement which would…

Vodafone Essar Ltd., Mumbai vs. Addl. CIT, Chandigarh

ITA 216/CHANDI/2011[2006-07]Status: DisposedITAT Mumbai16 Mar 2023AY 2006-07

Bench: Shri Vikas Awasthy & Shri M. Balaganeshआअसं. 216/ चंडी/2011 (िन.व. 2006-07) आअसं. 1173/चांडी /2011 (िन.व. 2007-08) Vodafone India Ltd. (Formerly Known As ‘ Vodafone Essar Limited’) Peninsula Corporate Park, Ganpatrao Kadam Marg, Lower Parel, Mumbai – 400 013. ...... अपीलाथ"/Appellant Pan:Aaach-5332-B बनाम Vs. Additional Commissioner Of Income Tax, Range -1, ..... ""तवाद"/Respondent Chandigarh. अपीलाथ" "वारा/ Appellant By : Shri Salil Kapoor With S/Shri Vibhu Jain & Ninad Patade ""तवाद" "वारा/Respondent By : Shri Anand Mohan

For Appellant: Shri Salil Kapoor with S/Shri Vibhu Jain and Ninad PatadeFor Respondent: Shri Anand Mohan
Section 115JSection 144C(13)Section 14ASection 234BSection 271(1)(c)Section 40Section 80I

…ture incurred for raising loan is revenue expenditure irrespective of the purpose or motive for which such loan is obtained. To support his contention, the ld. Counsel for the assessee placed reliance on the decision in the case of India Cements Ltd. vs. CIT, 60 ITR 52(SC). 25. The ld. Departmental Representative submits that the secured and unsecured loans raised have been utilized for non-business consideration. Hence, the expenses incurred to raise the loans have been rightly disallowed u/s. 37(1) of the Act. 26. We have heard the submissions made by rival sides and have examined the orders of authorities be…

M/S Vodafone Essar Ltd., Mumbai vs. Addl. CIT, Chandigarh

ITA 1173/CHANDI/2011[2007-08]Status: DisposedITAT Mumbai16 Mar 2023AY 2007-08

Bench: Shri Vikas Awasthy & Shri M. Balaganeshआअसं. 216/ चंडी/2011 (िन.व. 2006-07) आअसं. 1173/चांडी /2011 (िन.व. 2007-08) Vodafone India Ltd. (Formerly Known As ‘ Vodafone Essar Limited’) Peninsula Corporate Park, Ganpatrao Kadam Marg, Lower Parel, Mumbai – 400 013. ...... अपीलाथ"/Appellant Pan:Aaach-5332-B बनाम Vs. Additional Commissioner Of Income Tax, Range -1, ..... ""तवाद"/Respondent Chandigarh. अपीलाथ" "वारा/ Appellant By : Shri Salil Kapoor With S/Shri Vibhu Jain & Ninad Patade ""तवाद" "वारा/Respondent By : Shri Anand Mohan

For Appellant: Shri Salil Kapoor with S/Shri Vibhu Jain and Ninad PatadeFor Respondent: Shri Anand Mohan
Section 115JSection 144C(13)Section 14ASection 234BSection 271(1)(c)Section 40Section 80I

…ture incurred for raising loan is revenue expenditure irrespective of the purpose or motive for which such loan is obtained. To support his contention, the ld. Counsel for the assessee placed reliance on the decision in the case of India Cements Ltd. vs. CIT, 60 ITR 52(SC). 25. The ld. Departmental Representative submits that the secured and unsecured loans raised have been utilized for non-business consideration. Hence, the expenses incurred to raise the loans have been rightly disallowed u/s. 37(1) of the Act. 26. We have heard the submissions made by rival sides and have examined the orders of authorities be…

Tata Steel Limited, Mumbai vs. The Principle Commissioner of Income Tax, Mumbai

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

ITA 1316/MUM/2022[2012-2013]Status: DisposedITAT Mumbai23 Dec 2022AY 2012-2013
Section 115JSection 143(3)Section 263Section 36(1)(iii)

…see also placed reliance on the following decisions in support of its claim of deduction of issue expenses and interest as revenue expenditure before the ld. AO:- (a) Decision of the Hon‟ble Supreme Court in the case of India Cements Ltd. vs. CIT reported in 60 ITR 52. (b) Decision of the Hon‟ble Rajasthan High Court in the case of CIT vs. Secure Meters Ltd reported in 221 CTR 405 (Raj) (c) Decision of the Hon‟ble Jurisdictional High Court in the case of Premier Automobiles Ltd vs. CIT reported in 80 ITR 415 4.4. Based on the aforesaid factual submissions and judicial precedents, the assessee concluded that the…

Tata Steel Limited, Mumbai vs. The Principle Commissioner of Income Tax, Mumbai-2, Mumbai

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

ITA 1315/MUM/2022[2011-2012]Status: DisposedITAT Mumbai23 Dec 2022AY 2011-2012
Section 115JSection 143(3)Section 263Section 36(1)(iii)

…see also placed reliance on the following decisions in support of its claim of deduction of issue expenses and interest as revenue expenditure before the ld. AO:- (a) Decision of the Hon‟ble Supreme Court in the case of India Cements Ltd. vs. CIT reported in 60 ITR 52. (b) Decision of the Hon‟ble Rajasthan High Court in the case of CIT vs. Secure Meters Ltd reported in 221 CTR 405 (Raj) (c) Decision of the Hon‟ble Jurisdictional High Court in the case of Premier Automobiles Ltd vs. CIT reported in 80 ITR 415 4.4. Based on the aforesaid factual submissions and judicial precedents, the assessee concluded that the…

ACIT -893) (1), Mumbai vs. M/S. Triple Securities Pvt. Ltd, Mumbai

ITA 2270/MUM/2021[2016-17]Status: DisposedITAT Mumbai20 Dec 2022AY 2016-17
For Appellant: Shri Nitesh JoshiFor Respondent: Ms. Samruddhi Hande
Section 143(3)Section 36Section 43C

…asset. According to the Commissioner, since the loan was raised for securing capital asset, the interest incurred thereon constituted part of capital expenditure. This finding of the Commissioner was erroneous. In the case of India Cements Ltd. v. CIT [1966] 60 ITR 52 , it was held by the Supreme Court that in cases where the act of borrowing was incidental to carrying on of business, the loan obtained was not an asset. That, for the purposes of deciding the claim of deduction under section 10(2)(iii) of the Income-tax Act, 1922 [section 36(1)(iii) of the present Income-tax Act], it was irrelevant to consider th…

Gujarat Urja Vikas Nigam Ltd, Vadodara vs. DCIT, Cirecle-1(1)(1), Vadodara

In the result, the appeal filed by the Assessee is allowed for statistical purpose

ITA 406/AHD/2019[2015-16]Status: DisposedITAT Ahmedabad14 Dec 2022AY 2015-16

Bench: Us.

For Appellant: Shri M.J. Shah, A.RFor Respondent: Shri Atul Pandey, Sr.D.R
Section 115JSection 143(3)Section 14A

…by charge on its fixed assets is a revenue expenditure, because the transactions were entered into directly to facilitate the business of the company and payment of consultancy charges was made on ground of commercial expediency.In India Cements Ltd. vs. CIT, 60 ITR 52, the Supreme Court had also held that the expenditure incurred for securing the use of money for a certain period was revenue expenditure. In the instant case, the assessee has secured the loan by creating a charge (hypothecation of its assets). Hence the ratio of the above mentioned two cases would squarely apply. Accordingly, it is held that the…

Corrtech International Pvt. Ltd., Ahmedabad vs. The Addl. CIT, TDS Range, Ahmedabad

ITA 2408/AHD/2017[2015-16]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2015-16

Bench: Ms. Suchitra Kamble& Shri Waseem Ahmed

Section 14ASection 26(1)(iii)

…ness requirement expenses incurred for procuring such facilities is revenue in nature. Accordingly, impugned addition has been rightly deleted by the CIT(A). The Ld. A.R. relied upon the decision of the Hon’ble Apex Court in case of India Cement Ltd. vs. CIT, 60 ITR 52 (SC) wherein it has been held that incidental expenditure incurred for obtaining loan from a financial institution is revenue expenses. 25. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the stamp duty and share capital expenses were the requirement of the business activity on…