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

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

ITA 2406/AHD/2017[2014-15]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2014-15

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…

The Deputy Commissioner of Income Tax, Circle-1(1)(2), Ahmedabad vs. M/S. Corrtech International Pvt. Ltd., Ahmedabad

ITA 1358/AHD/2017[2010-11]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2010-11

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…

Corrtech International Pvt.Ltd., Ahmedabad vs. Dy. Commissioner of Income Tax, (OSD), Ahmedabad

ITA 821/AHD/2015[2008-09]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2008-09

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…

The DCIT(OSD) Range-1, Ahmedabad vs. M/S. Corrtech International Pvt.Ltd., Ahmedabad

ITA 1129/AHD/2015[2008-09]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2008-09

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…

Corrtech International Pvt.Ltd., Ahmedabad vs. The ACIT., (OSD) Range-1, Ahmedabad

ITA 2652/AHD/2014[2010-11]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2010-11

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…

The DCIT(OSD) Range-1, Ahmedabad vs. M/S. Corrtech International Pvt.Ltd., Ahmedabad

ITA 2578/AHD/2014[2010-11]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2010-11

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…

The DCIT(OSD)Range-1, Ahmedabad vs. Corrtech International Pvt.Ltd., Ahmedabad

ITA 1871/AHD/2012[2009-10]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2009-10

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…

Corrtech International Pvt.Ltd., Ahmedabad vs. The ACIT., (OSD)Range-1, Ahmedabad

ITA 1785/AHD/2012[2009-10]Status: DisposedITAT Ahmedabad19 Oct 2022AY 2009-10

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…

Dy. Commissioner of Income Tax, Circle-2(1), Hyderabad vs. Jath Wind Energy Private Limited, Hyderabad

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

ITA 1321/HYD/2019[2016-17]Status: DisposedITAT Hyderabad18 Oct 2022AY 2016-17

Bench: Shri Rama Kanta Panda & Shri K.Narasimha Charyassessment Year: 2016-17 Dcit,Circle-2(1) Vs. Jath Wind Energy Private Room No.514 Limited 5Th Floor 8-2-684/A, Nsl Icon, Signature Towers 4Th Floor, Road No.12, Kondapur-500 084 Banjara Hills Hyderabad-500 034

For Appellant: Shri Aliasager RampurawalaFor Respondent: Shri Kumar Aditya, Sr.AR
Section 143(2)

…4. Insofar as the merits of the issue are concerned, as can be seen from impugned order of Tribunal, insofar as proposed question No.6 is concerned, it has applied the ratio of the Apex court decision in the case of India Cements Ltd. vs. CIT, Madras [1966] 60 ITR 52, and there is nothing on record to show as to how the same is incorrect in any manner whatsoever. Therefore, no infirmity can be found in relation to the same. 6 ITA 1321/Hyd/2019 13. Referring to the decision of the Hon’ble Supreme Court, he submitted that Hon’ble Supreme Court upheld the decision of the Hon’ble Gujarat High Court in the case of…

The ACIT, Circle-4, Baroda vs. M/S. Org Informatics Ltd., Baroda

In the result, appeal filed by the Revenue is dismissed

ITA 1877/AHD/2014[2008-09]Status: DisposedITAT Ahmedabad21 Sept 2022AY 2008-09

Bench: Ms. Suchitra Kamble & Shri Waseem Ahmedassessment Year: 2008-09

For Appellant: NoneFor Respondent: Shri Atul Pandey, Sr. DR
Section 129Section 139(1)Section 142(1)Section 143(1)Section 143(2)

…till date and it is not likely to covert because the market price of the company’s share is below Rs.10 as on that particular date. The entire amount of FCCB is to be redeemed on or before 14.11.2012. The assessee relied upon the decision of India Cement (SC) 60 ITR 52, decision of Hon’ble Rajasthan High Court in the case of CIT vs. Secure Meters Limited, 175 taxman 567. After going through the assessee’s submissions, the CIT(A) has observed that the decision relied by the Assessing Officer in the case of Ashima Syntex (100 ITD 247) and Banco Products (I) Limited vs. DCIT of ITAT Ahmedabad was delivered prior to…

Royal Orchid Hotels Ltd, Bengaluru vs. Assisstant Commissioner of Income Tax, Circle-5(1)(1), Bengaluru

In the result, this ground is allowed

ITA 793/BANG/2018[2011-12]Status: DisposedITAT Bangalore20 Sept 2022AY 2011-12

Bench: Shri George George K. & Shri Laxmi Prasad Sahuassessment Year : 2011-12

For Appellant: Shri R.B Krishna, AdvocateFor Respondent: Shri Sankar Ganesh, JCIT (DR)
Section 14ASection 194HSection 40

…nce procurement of heavy machinery were purely in the nature of revenue expenditure. Disallowance of processing charges is against law as the nature of expense in the appellant' case is similar to the expense incurred in the case of India Cement Ltd. Vs. CIT, 60 ITR 52 wherein it was held that amount spent towards stamp duty, registration fees and lawyer fees for creating charge on fixed assets were held to be revenue nature. It is the substance of the expenses that need to be looked into and not the nomenclature used while following judicial pronouncements. Placing reliance on above, it was held by the ITAT, New…

Commr.of I.T.-I, Hyd vs. A.P.Gas Power Cor.Ltd, Hyd

ITTA/135/2003HC Telangana14 Sept 2022

Bench: C.V. BHASKAR REDDY,UJJAL BHUYAN

For Respondent: SRI CHALLA GUNARANJAN
Section 260Section 36Section 36(1)Section 37(1)

…rdrge nrcx couRT FoR THE srATE oF TELANGANA AT HYDERABAD WEDNESDAY ,THE FOUR TEENTH DAY OF SEPTEMBER TWO THOUSAND AND fWerrffV fWO '- ' PRESENT THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN THE HON'BLE SRI JUSTICE C.V. BHASKAR REDDY tNco ETAXT RIBUN APPE NO:135 03 F Appeal Under Section 260-4 of the lncome Tax Act, 1g61 arising out of the order of the lncome Tax Appellate Tribunal, Hyderabad Bench ,,B,, , Hyderabad in r'T.A. No. 668 r Ht 2ooo dated 31-05-2002 for Assessment year 1997 -98 preferred against the order of the commissioner of rncome Tax ( Appears ) rv Hvderabad dated 8-09-2000 in Appear No. 1 13 / Jc.sR…

Crayons Advertising (P) Ltd., New Delhi vs. DCIT Circle-6(2), New Delhi

In the result, this appeal of the assessee is partly allowed for statistical purpose

ITA 7491/DEL/2019[2015-16]Status: DisposedITAT Delhi09 Sept 2022AY 2015-16

Bench: Shri Shamim Yahya & Shri Yogesh Kumar Us[Assessment Year: 2015-16]

Section 10(38)Section 234BSection 28Section 36Section 56(2)(vii)

…e authorities have erred in disallowing the expenditure by holding that processing fee for purchase of capital asset is capital expenditure. In this regard, he relied upon the decision of Hon’ble Supreme Court in the case of India Cements Ltd. vs CIT (1966) 60 ITR 52(SC). We find that in the case of India Cements Ltd. (Supra), Hon’ble Apex Court has expounded that loan is neither an asset nor any business advantage and that nature of expenditure incurred in raising a loan is not dependent upon nature and purpose of loan. Accordingly, we set-aside the order of authorities below and decide the issue in favour o…

The ACIT, Circle-1(1)(1), Vadodara vs. Gujarat Energy Transmission Corpn. Ltd., Vadodara

In the result, both appeals filed by the assessee are allowed for statistical purposes and both the appeals filed by the Revenue are hereby dismissed

ITA 853/AHD/2018[2014-15]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2014-15
For Appellant: Shri Manish J. Shah, Advocate &For Respondent: Shri A.P. Singh, CIT/DR
Section 143(3)Section 271

…nual recurring expenditure incurred by the assessee. Guarantee fee was payable to Govt. of Gujarat every year in respect of loans taken by the assessee and guaranteed by the Govt. of Gujarat. As held by Hon'ble Supreme Court in the case of India Cements Ltd., 60 ITR 52 (SC), loan cannot be treated as asset or advantage resulting in enduring benefits. Guarantee fees paid to Govt. of Gujarat was in connection with raising of loans and enduring benefit or advantage could not be said to have resulted by taking such loans. Only if the assets acquired out of such loans were not put-to-use till the end of previous year…

Gujarat Energy Transmission Corpn. Ltd., Vadodara vs. The DCIT, Circle-1(1), Vadodara

In the result, both appeals filed by the assessee are allowed for statistical purposes and both the appeals filed by the Revenue are hereby dismissed

ITA 754/AHD/2018[2014-15]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2014-15
For Appellant: Shri Manish J. Shah, Advocate &For Respondent: Shri A.P. Singh, CIT/DR
Section 143(3)Section 271

…nual recurring expenditure incurred by the assessee. Guarantee fee was payable to Govt. of Gujarat every year in respect of loans taken by the assessee and guaranteed by the Govt. of Gujarat. As held by Hon'ble Supreme Court in the case of India Cements Ltd., 60 ITR 52 (SC), loan cannot be treated as asset or advantage resulting in enduring benefits. Guarantee fees paid to Govt. of Gujarat was in connection with raising of loans and enduring benefit or advantage could not be said to have resulted by taking such loans. Only if the assets acquired out of such loans were not put-to-use till the end of previous year…

Gujarat Energy Transmission Corpn. Ltd., Vadodara vs. The DCIT, Circle-1(1), Vadodara

In the result, both appeals filed by the assessee are allowed for statistical purposes and both the appeals filed by the Revenue are hereby dismissed

ITA 753/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2013-14
For Appellant: Shri Manish J. Shah, Advocate &For Respondent: Shri A.P. Singh, CIT/DR
Section 143(3)Section 271

…nual recurring expenditure incurred by the assessee. Guarantee fee was payable to Govt. of Gujarat every year in respect of loans taken by the assessee and guaranteed by the Govt. of Gujarat. As held by Hon'ble Supreme Court in the case of India Cements Ltd., 60 ITR 52 (SC), loan cannot be treated as asset or advantage resulting in enduring benefits. Guarantee fees paid to Govt. of Gujarat was in connection with raising of loans and enduring benefit or advantage could not be said to have resulted by taking such loans. Only if the assets acquired out of such loans were not put-to-use till the end of previous year…

The ACIT, Circle-1(1)(1), Vadodara vs. Gujarat Energy Transmission Corpn. Ltd., Vadodara

In the result, both appeals filed by the assessee are allowed for statistical purposes and both the appeals filed by the Revenue are hereby dismissed

ITA 852/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2013-14
For Appellant: Shri Manish J. Shah, Advocate &For Respondent: Shri A.P. Singh, CIT/DR
Section 143(3)Section 271

…nual recurring expenditure incurred by the assessee. Guarantee fee was payable to Govt. of Gujarat every year in respect of loans taken by the assessee and guaranteed by the Govt. of Gujarat. As held by Hon'ble Supreme Court in the case of India Cements Ltd., 60 ITR 52 (SC), loan cannot be treated as asset or advantage resulting in enduring benefits. Guarantee fees paid to Govt. of Gujarat was in connection with raising of loans and enduring benefit or advantage could not be said to have resulted by taking such loans. Only if the assets acquired out of such loans were not put-to-use till the end of previous year…

Apl Logistics P.Ltd, Mumbai vs. DCIT 14(1)(1), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 2917/MUM/2015[2009-10]Status: DisposedITAT Mumbai12 Aug 2022AY 2009-10
Section 14ASection 36(1)(iii)Section 37(1)

…the company had not yet started production when it borrowed the amount in question. The more appropriate decision applicable to the present case would be the judgment of this court in the case of India Cements Ltd. v. Commissioner of Income-tax, Madras (1966) 60 ITR 52 in which it has been observed that, for considering whether payment of interest on borrowing is revenue expenditure or not, the purpose for which the borrowing is made is irrelevant. In our view, Section 36(1)(iii) of the 1961 Act has to be read on its own terms. It is a Code by itself. Section 36(1)(iii) is attracted when the assessee borrows the…

Apl Logistics (India) P. Ltd, Mumbai vs. Asst CIT 10(1), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 6482/MUM/2013[2007-08]Status: DisposedITAT Mumbai12 Aug 2022AY 2007-08
Section 14ASection 36(1)(iii)Section 37(1)

…the company had not yet started production when it borrowed the amount in question. The more appropriate decision applicable to the present case would be the judgment of this court in the case of India Cements Ltd. v. Commissioner of Income-tax, Madras (1966) 60 ITR 52 in which it has been observed that, for considering whether payment of interest on borrowing is revenue expenditure or not, the purpose for which the borrowing is made is irrelevant. In our view, Section 36(1)(iii) of the 1961 Act has to be read on its own terms. It is a Code by itself. Section 36(1)(iii) is attracted when the assessee borrows the…

Apl Logistics (India) P.Ltd, Mumbai vs. Asst CIT 10(1), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 6480/MUM/2013[2008-09]Status: DisposedITAT Mumbai12 Aug 2022AY 2008-09
Section 14ASection 36(1)(iii)Section 37(1)

…the company had not yet started production when it borrowed the amount in question. The more appropriate decision applicable to the present case would be the judgment of this court in the case of India Cements Ltd. v. Commissioner of Income-tax, Madras (1966) 60 ITR 52 in which it has been observed that, for considering whether payment of interest on borrowing is revenue expenditure or not, the purpose for which the borrowing is made is irrelevant. In our view, Section 36(1)(iii) of the 1961 Act has to be read on its own terms. It is a Code by itself. Section 36(1)(iii) is attracted when the assessee borrows the…

India Cements Ltd. v. CIT (60 ITR 52) — Cited in 247 Judgments | BharatTax