Indian Molasses Co. Pvt. Ltd. v. CIT

37 ITR 66Supreme Court of India1959#438 most cited

What is Indian Molasses Co. Pvt. Ltd. v. CIT authority for?

Expenditure is defined as money paid out or away, which is gone irretrievably. To be deductible under Section 37(1), expenditure must be wholly and exclusively for business, not capital or personal, and not fall under specific provisions of Sections 30 to 36, often justifiable on grounds of commercial expediency.

206

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

Indian Molasses Co. Pvt. Ltd. v. CIT · Section 37(1) · definition of expenditure · business expenditure deduction · commercial expediency · wholly and exclusively for business · expenditure irretrievably gone · Sections 30-36

Sections most often in play

Section 142(1)Section 143(2)Section 143(3)Section 234BSection 234CSection 11Section 13(1)(c)Section 13(2)(h)
Read the full judgment

Issues it is cited on

section 13(2)accumulation of incomesection 13(3)section 13(1)(c)infrastructure facilitysection 13(1)section 30business expediencymercantile system of accountingcommercial expediencysection 40(a)(i)profits and gains of business or profession

Judgments citing Indian Molasses Co. Pvt. Ltd. v. CIT

CIT vs. Jagdish Prasad Gupta

ITA/711/2011HC Delhi18 Aug 2017

Bench: HON'BLE DR. JUSTICE S.MURALIDHAR,HON'BLE MS. JUSTICE PRATHIBA M. SINGH

Section 260A

…Page 22 of 39 Indian Smelting & Refinery Co. Ltd. [1998] 230 ITR 194 (Bom.) as affirmed in Indian Smelting & Refinery v. CIT [2001] 116 TAXMANN 606 (SC); Indian Molasses Co. (Private) Ltd. v. CIT [1959] 37 ITR 66 (SC); CIT v. Swadeshi Cotton & Flour Mills Pvt. Ltd. [1964] 53 ITR 134 (SC). (v) The demand for enhanced licence fees was raised on the Assessee by the Northern Railway on 20th January, 1999 which fell in the accounting year relevant to AY 1999-00. Although the Assessee could have claimed this additional amount, as he did in the return for…

Jagdish Prasad Gupta

ITA/695/2010HC Delhi18 Aug 2017

Bench: HON'BLE DR. JUSTICE S.MURALIDHAR,HON'BLE MS. JUSTICE PRATHIBA M. SINGH

Section 260A

…Page 22 of 39 Indian Smelting & Refinery Co. Ltd. [1998] 230 ITR 194 (Bom.) as affirmed in Indian Smelting & Refinery v. CIT [2001] 116 TAXMANN 606 (SC); Indian Molasses Co. (Private) Ltd. v. CIT [1959] 37 ITR 66 (SC); CIT v. Swadeshi Cotton & Flour Mills Pvt. Ltd. [1964] 53 ITR 134 (SC). (v) The demand for enhanced licence fees was raised on the Assessee by the Northern Railway on 20th January, 1999 which fell in the accounting year relevant to AY 1999-00. Although the Assessee could have claimed this additional amount, as he did in the return for…

Leo Fasteners, Pondicherry vs. DCIT, Pondicherry

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

ITA 508/CHNY/2017[2012-13]Status: HeardITAT Chennai31 Jul 2017AY 2012-13

Bench: Shri N.R.S. Ganesan & Shri S. Jayaraman

For Appellant: Smt. Pushya Seetharaman, Sr. CounselFor Respondent: Shri S. Nataraja, JCIT
Section 37(1)Section 43A

…nt before us was that the word "expenditure" in section 37(1) connotes " what is paid out" and that which has gone irretrievably. In this connection, heavy reliance was placed on the judgment of this court in the case of Indian Molasses Company P. Ltd. [1959] 37 ITR 66. Relying on the said judgment, it was sought to be argued that the increase in liability at any point of time prior to the date of payment cannot be said to have gone irretrievably as it can always come back. According to the learned counsel, in the case of increase in liability due to foreign exchange fluctuations, if there is a revaluation of the…

Inductotherm (India) Private Ltd., Ahmedabad vs. The Dy.CIT., Circle-2(1)(1), Ahmedabad

In the result, the assessee’s appeal for the assessment year 2011-12 is also partly allowed in the terms indicated above

ITA 243/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad24 May 2017AY 2010-11

…ated a provision of Rs 5,00,000. The Assessing Officer was of the view that the provision so made is contingent expenses in nature and cannot be disallowed. Relying upon Hon’ble Supreme Court’s decision in the case of Indian Molasses Co Pvt Ltd Vs CIT [(1959) 37 ITR 66 (SC)], the Assessing Officer proposed to reject the said claim. Aggrieved, ITA Nos.3108/A/2010, 2609/A/2012, 671/A/2014, 243/A/2015 & 370/A/2016 AYs: 2006-07, 2008-09, 2009-10, 2010-11 & 2011-12 Page 4 of 31 assessee did raise an objection before the DRP but without any success. The DRP confirmed the stand of the Assessing Officer and reiterated…

Inductotherm (India) Private Ltd., Ahmedabad vs. The Dy.CIT., Circle-4, Ahmedabad

In the result, the assessee’s appeal for the assessment year 2011-12 is also partly allowed in the terms indicated above

ITA 671/AHD/2014[2009-10]Status: DisposedITAT Ahmedabad24 May 2017AY 2009-10

…ated a provision of Rs 5,00,000. The Assessing Officer was of the view that the provision so made is contingent expenses in nature and cannot be disallowed. Relying upon Hon’ble Supreme Court’s decision in the case of Indian Molasses Co Pvt Ltd Vs CIT [(1959) 37 ITR 66 (SC)], the Assessing Officer proposed to reject the said claim. Aggrieved, ITA Nos.3108/A/2010, 2609/A/2012, 671/A/2014, 243/A/2015 & 370/A/2016 AYs: 2006-07, 2008-09, 2009-10, 2010-11 & 2011-12 Page 4 of 31 assessee did raise an objection before the DRP but without any success. The DRP confirmed the stand of the Assessing Officer and reiterated…

Inductotherm (India) Private Ltd., Ahmedabad vs. The Jt.CIT., Range-4, Ahmedabad

In the result, the assessee’s appeal for the assessment year 2011-12 is also partly allowed in the terms indicated above

ITA 2609/AHD/2012[2008-09]Status: DisposedITAT Ahmedabad24 May 2017AY 2008-09

…ated a provision of Rs 5,00,000. The Assessing Officer was of the view that the provision so made is contingent expenses in nature and cannot be disallowed. Relying upon Hon’ble Supreme Court’s decision in the case of Indian Molasses Co Pvt Ltd Vs CIT [(1959) 37 ITR 66 (SC)], the Assessing Officer proposed to reject the said claim. Aggrieved, ITA Nos.3108/A/2010, 2609/A/2012, 671/A/2014, 243/A/2015 & 370/A/2016 AYs: 2006-07, 2008-09, 2009-10, 2010-11 & 2011-12 Page 4 of 31 assessee did raise an objection before the DRP but without any success. The DRP confirmed the stand of the Assessing Officer and reiterated…

Ford India (P) Ltd, Chennai vs. Dy CIT Ltu, Chennai

In the result, the assessee’s appeal is allowed

ITA 2345/CHNY/2012[2008-09]Status: DisposedITAT Chennai12 May 2017AY 2008-09

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singhआयकर अपील सं./Ita Nos.2344 & 2345/Mds/2012 "नधा*रण वष* /Assessment Year: 2005-06 & 2008-09

For Respondent: 28.02.2017
Section 143(3)

…eating it as a contingent liability as the same was made on a provisional basis and could not be considered as liability accrued during the year. The AO placed reliance on the decision of the Supreme Court in the case of Indian Molasses Co. Ltd. v. CIT [ 959] 37 ITR 66 (SC). • The Appellant submits that pursuant to stringent norms prescribed by the Ford Group for inventory monitoring, the Appellant had created the said provision for stock obsolescence on scientific basis, by identifying each part which is obsolete, at both the plant as well as vendor’s place. • In addition, the Appellant submits that the creation…

Ford India (P) Ltd, Chennai vs. Dy CIT Ltu, Chennai

In the result, the assessee’s appeal is allowed

ITA 2344/CHNY/2012[2005-06]Status: DisposedITAT Chennai12 May 2017AY 2005-06

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singhआयकर अपील सं./Ita Nos.2344 & 2345/Mds/2012 "नधा*रण वष* /Assessment Year: 2005-06 & 2008-09

For Respondent: 28.02.2017
Section 143(3)

…eating it as a contingent liability as the same was made on a provisional basis and could not be considered as liability accrued during the year. The AO placed reliance on the decision of the Supreme Court in the case of Indian Molasses Co. Ltd. v. CIT [ 959] 37 ITR 66 (SC). • The Appellant submits that pursuant to stringent norms prescribed by the Ford Group for inventory monitoring, the Appellant had created the said provision for stock obsolescence on scientific basis, by identifying each part which is obsolete, at both the plant as well as vendor’s place. • In addition, the Appellant submits that the creation…

M/S. Religare Finvest Ltd., New Delhi vs. ACIT, New Delhi

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

ITA 2284/DEL/2013[2008-09]Status: DisposedITAT Delhi28 Apr 2017AY 2008-09

Bench: Sh. I.C. Sudhir & Sh. O.P. Kantassessment Year: 2008-09 Vs. Acit, Circle-15(1), New Delhi Religare Finvest Ltd., D-3, P3B, District Centre, Saket, New Delhi Pan : Aafcs6801H (Appellant) (Respondent) Appellant By Sh. Rohit Garg, Adv. & Ms. Tejasvi Jain, Ca Respondent By Sh. F.R. Meena, Sr.Dr Date Of Hearing 28.03.2017 Date Of Pronouncement 28.04.2017 Order Per O.P. Kant, A.M.: This Appeal By The Assessee Is Directed Against The Order Of Learned Commissioner Of Income Tax (Appeals)-Xviii, New Delhi, Dated 28.02.2013, Raising The Following Grounds Of Appeal:

Section 28Section 36Section 37(1)Section 40A(2)(b)

…he assessee incurs any expenditure, which thereafter satisfies the requisite conditions of the sub-section (1). He submitted that the word "expenditure" has been described by the Hon'ble Supreme Court in the case of Indian Molasses Co. (P.) Ltd. v. CIT [1959] 37 ITR 66 as denoting spending or paying out, i.e. something going out of the coffers of the assessee. It was put forth that by issuing shares at discounted premium, nothing is paid out by the company. Once there is no "paying out or away", the same cannot constitute an expenditure and resultantly section 37(1), which applies to only expenditure, cannot be a…

Molson Coors Cobra India P.Ltd, Mumbai vs. DCIT 3(1), Mumbai

Accordingly, Ground no.2 with its sub-grounds raised by the assessee are allowed for statistical purposes

ITA 7576/MUM/2013[2008-09]Status: DisposedITAT Mumbai15 Mar 2017AY 2008-09
For Appellant: Shri Riaj Thingna and Ms.Vaishali Mane-ARFor Respondent: Shri Saurabh Deshpande-DR
Section 254(1)

…present obligation arising from past events, the settlement of which is expected to result in an outflow of resources and in respect of which a reliable estimate is possible of the amount of obligation. As stated above, the case of Indian Molasses Co. [1959] 37 ITR 66 (SC) is different from the present case. As stated above, in the present case we are concerned with an army of items of sophisticated (specialised) goods manufactured and sold by the assessee whereas the case of Indian Molasses Co. [1959] 37 ITR 66 (SC) was restricted to an individual retiree. On the other hand, the case of Metal Box Company of Ind…

ITO 16(2)(4), Mumbai vs. Surya Gems, Mumbai

The appeal of the Revenue is dismissed

ITA 292/MUM/2014[2009-10]Status: DisposedITAT Mumbai08 Mar 2017AY 2009-10

Bench: Shri Joginder Singh & Shri N.K. Pradhanassessment Year: 2009-10 Income Tax Officer-16(2)(4), M/S Surya Gems, बनाम/ 02Nd Floor, Matru Mandir, Flat No.4, 02Nd Floor, Tardeo Road, Bhaveshwar Sgar Patel Vs. Mumbai-400007 Compound 20 Napean Sea Road, Mumbai-400020 (याजस्व /Revenue) (यनधाारयती /Assessee) P.A. No. Aakfs6513Q याजस्व की ओर से / Revenue By Shri B.S. Bist-Dr यनधाारयती की ओर से / Assessee By None ुनवाई की तायीख / Date Of Hearing : 14/02/2017 आदेश की तायीख /Date Of Order: 08/03/2017

…prudent trader sets apart to meet a liability, not actually present but only contingent, cannot bear the character of expenses till the liability becomes real. He also referred to the decision ofthe Hon‘ble Supreme Court in the case of Indian Molasses‘ case (37 ITR 66), wherein also, it was held that where the liability is contingent, the same is not allowable. The Hon‘ble Supreme Court observed as under:- ―The expenditure which is deductible for income tax purposes is one which is towards a liability actually existing at the time, but the putting aside of money which may become expenditure on the happening of a…

I.T.O WD - 8(3), Kolkata vs. M/S Ruia Sons Pvt Ltd., Kolkata

In the result the appeal by the revenue is partly allowed

ITA 365/KOL/2013[2009-10]Status: DisposedITAT Kolkata03 Mar 2017AY 2009-10

Bench: Hon’Ble Sri M.Balaganesh, Am & Shri Partha Sarathi Chaudhury, Jm] I.T.A No. 365/Kol/2013 Assessment Year : 2009-10 I.T.O., Ward-8(3), -Vs.- M/S. Ruia Sons Pvt. Ltd. Kolkata Kolkata [Pan : Aaccr 3949 Q] (Respondent) (Appellant) For The Appellant : Shri Arup Kumar Sinha, Cit For The Respondent : Shri Manoj Kataruka, Advocate

For Appellant: Shri Arup Kumar Sinha, CITFor Respondent: Shri Manoj Kataruka, Advocate
Section 143(2)Section 143(3)Section 194CSection 194JSection 301Section 40

…IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH : KOLKATA [Before Hon’ble Sri M.Balaganesh, AM & Shri Partha Sarathi Chaudhury, JM] I.T.A No. 365/Kol/2013 Assessment Year : 2009-10 I.T.O., Ward-8(3), -vs.- M/s. Ruia Sons Pvt. Ltd. Kolkata Kolkata [PAN : AACCR 3949 Q] (Respondent) (Appellant) For the Appellant : Shri Arup Kumar Sinha, CIT For the Respondent : Shri Manoj Kataruka, Advocate Date of Hearing : 02.02.2017. Date of Pronouncement : 03.03.2017. ORDER Per Shri Partha Sarathi Chaudhury, JM This appeal preferred by the Revenue emanates from the order of ld. CIT(A)- VIII, Kolkata dated 26.11.2012 on t…

I.T.O WD - 7(3), Kolkata. vs. M/S Shalini Properties & Developers Private Limited., Kolkata

In the result the appeal preferred by the revenue is dismissed

ITA 171/KOL/2013[2009-10]Status: DisposedITAT Kolkata28 Feb 2017AY 2009-10

Bench: Hon’Ble Sri M.Balaganesh, Am & Shri Partha Sarathi Chaudhury, Jm] I.T.A No. 171/Kol/2013 Assessment Year : 2009-10 I.T.O., Ward-7(3) -Vs.- M/S. Shalini Properties & Developers Kolkata Pvt. Limited., Kolkata [Pan : Aahcs 7896 N] (Respondent) (Appellant) For The Appellant : Shri Arup Kumar Sinha, Cit For The Respondent : Shri Manoj Kataruka, Advocate

For Appellant: Shri Arup Kumar Sinha, CITFor Respondent: Shri Manoj Kataruka, Advocate
Section 143(3)Section 301Section 37(1)

…e ownership of the money whether in point of fact or by a resulting trust is still with the taxpayer, then there is acquisition of a capital asset and not an expenditure of a revenue character as per ratio laid down in Indian Molasses Co.(P)Ltd. V. cIT [1959] 37 ITR 66 (SC), Hylam Ltd. V. CIT [1973] 87 ITR 310 (AP). Though the dividing line between a capital and revenue expenditure is real, yet sometimes it becomes difficult to draw. Therefore, a decision is to be taken in each case in the light of the facts and surrounding circumstances. However, the following judicial pronouncements should be kept in view while…

Priya Ltd., Mumbai vs. DCIT (OSD), Cir 2(3), Mumbai

The appeal of the assessee is disposed off in terms indicated hereinabove and the appeal of the Revenue is dismissed

ITA 3231/MUM/2015[2010-11]Status: DisposedITAT Mumbai21 Feb 2017AY 2010-11

Bench: Shri Joginder Singh & Shri N.K. Pradhanassessment Year: 2010-11 Priya Ltd. Dcit(Osd), Circle-2(3), 209-210, Kimatraj Building बनाम/ R. No. 552, 5Th Floor, 02 Floor, 77/79 Vs. Aayakar Bhavan, M.K.Road, M.K. Road, Mumbai-400020 Mumbai-400002 ("नधा"रती /Assessee) (राज"व /Revenue) P.A. No. Aaacp2210Q Assessment Year: 2010-11 Dcit(Osd), Priya Ltd. 209-210, Kimatraj Building Circle-2(3), बनाम/ 02 Floor, 77/79 R. No. 552, 5Th Floor, Vs. M.K. Road, Aayakar Bhavan, M.K.Road, Mumbai-400002 Mumbai-400020 (राज"व /Revenue) ("नधा"रती /Assessee) P.A. No. Aaacp2210Q

Section 10(33)Section 143(3)Section 14ASection 260A

…l quantification might not be possible, that in the case under consideration these facts were missing, that liability would arise only when any claim was made by the purchasers and not before. He placed reliance on the judgments of Indian Molasses Co. P. Ltd (37 ITR 66),Calcutta Co. Ltd (37ITR1) Sajjan Mill Ltd (156 ITR 585). He finally held that the assessee had made a provision regarding charges payable in terms of sale which had not crystallised ,that the assessee failed to prove the actual incurrence of liability under the warranty cause, that in absence of any such details, acceptance of the claim without a…

M/S. Religare Commodities Ltd., New Delhi vs. ACIT, New Delhi

In the result the disallowance made by the Ld

ITA 2283/DEL/2013[2008-09]Status: DisposedITAT Delhi04 Jan 2017AY 2008-09

Bench: Ms Suchitra Kamble & Shri Prashant Maharishireligare Commodities Ltd, Acit, D3, P3B, District Centre, Saket, Circle-15(1), Vs. New Delhi New Delhi Pan:Aaacf8356R (Appellant) (Respondent) Religare Commodities Ltd, Dcit, D3, P3B, District Centre, Saket, Circle-15(1), Vs. New Delhi New Delhi Pan:Aaacf8356R (Appellant) (Respondent)

For Appellant: Sh. Ajay Vohra, Sr. AdvFor Respondent: Sh. FR Meena, Sr. DR
Section 28Section 36(1)(ii)Section 37(1)

…he assessee incurs any expenditure, which thereafter satisfies the requisite conditions of the sub-section (1). He submitted that the word "expenditure" has been described by the Hon'ble Supreme Court in the case of Indian Molasses Co. (P.) Ltd. v. CIT [1959] 37 ITR 66 as denoting spending or paying out, i.e. something going out of the coffers of the assessee. It was put forth that by issuing shares at discounted premium, nothing is paid out by the company. Once there is no "paying out or away", the same cannot constitute an expenditure and resultantly section 37(1), which applies to only expenditure, cannot be a…

Case New Holland Construction Equipment (India) P.Ltd, Mumbai vs. JCIT (OSD) Cir 2(2), Mumbai

ITA 3669/MUM/2013[2008-09]Status: DisposedITAT Mumbai21 Sept 2016AY 2008-09
For Appellant: S/Shri Harsh Shah & Paras Savla -ARFor Respondent: Shri K. Ravi Chandran - DR
Section 254(1)

…आयकर अपीलीय अिधकरण, मुंबई “सी सी सी” खंडपीठ सी Income-tax Appellate Tribunal -“C”Bench Mumbai सव"ी सव"ी सव"ी राजे"" सव"ी राजे"" राजे"",लेखा राजे"" लेखा लेखा सद"य लेखा सद"य सद"य एवं सद"य एवं एवं सी एवं सी सी. एन सी एन एन. "साद एन "साद "साद,"याियक "साद "याियक "याियक सद"य "याियक सद"य सद"य सद"य Before S/Shri Rajendra,Accountant Member and C.N. Prasad,Judicial Member आयकर आयकर अपील अपील संसंसंसं./ITA/3669/Mum/2013,िनधा"रण िनधा"रण वष" वष" /Assessment Years: 2008-09 आयकर आयकर अपील अपील िनधा"रण िनधा"रण वष" वष" Case New Holland Construction JCIT (OSD) Equipment (India) Pvt. Ltd. Circle-2(2) (Formerly known as L&T Case…

New Delhi Television Ltd., New Delhi vs. ACIT, New Delhi

In the result this ground is allowed for statistical purposes

ITA 2851/DEL/2013[2007-08]Status: DisposedITAT Delhi17 Aug 2016AY 2007-08

Bench: Shri J. Sudhakar Reddy & Ms. Suchitra Kamblea.Y. 2007-08

For Appellant: Sh. C.S.Aggarwal, Sr.Adv. &For Respondent: Sh. Amit Mohan Govil, CIT, D.R
Section 143(3)Section 92C

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘I-2’, NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER A.Y. 2007-08 New Delhi Television Ltd. vs. ACIT, Circle 13(1) 207, Okhla Industrial Estate New Delhi Phase III New Delhi 110 020 PAN: AAACN0865D And A.Y. 2007-08 Dy.CIT, Circle 13(1) vs. M/s New Delhi Television Ltd. New Delhi New Delhi (Appellant) (Respondent) Appellant by : Sh. C.S.Aggarwal, Sr.Adv. & Sh. KM Gupta, Adv. Respondent by : Sh. Amit Mohan Govil, CIT, D.R. ORDER PER J. SUDHAKAR REDDY, ACCOUNTANT MEMBER These are Cross Appeals filed for…

DCIT, New Delhi vs. M/S New Delhi Television Ltd., New Delhi

In the result this ground is allowed for statistical purposes

ITA 2752/DEL/2013[2007-08]Status: DisposedITAT Delhi17 Aug 2016AY 2007-08

Bench: Shri J. Sudhakar Reddy & Ms. Suchitra Kamblea.Y. 2007-08

For Appellant: Sh. C.S.Aggarwal, Sr.Adv. &For Respondent: Sh. Amit Mohan Govil, CIT, D.R
Section 143(3)Section 92C

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘I-2’, NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER A.Y. 2007-08 New Delhi Television Ltd. vs. ACIT, Circle 13(1) 207, Okhla Industrial Estate New Delhi Phase III New Delhi 110 020 PAN: AAACN0865D And A.Y. 2007-08 Dy.CIT, Circle 13(1) vs. M/s New Delhi Television Ltd. New Delhi New Delhi (Appellant) (Respondent) Appellant by : Sh. C.S.Aggarwal, Sr.Adv. & Sh. KM Gupta, Adv. Respondent by : Sh. Amit Mohan Govil, CIT, D.R. ORDER PER J. SUDHAKAR REDDY, ACCOUNTANT MEMBER These are Cross Appeals filed for…

Ge Capital Services India vs. Addl CIT Range 2

In the result, the appeals of the assessee and Revenue are partly allowed for

ITA 2898/DEL/2007[2000-2001]Status: DisposedITAT Delhi06 Jun 2016AY 2000-2001

Bench: Smt Diva Singh & Sh.L.P.Sahu

Section 14ASection 234DSection 45J

…ent before us was that the word "expenditure" in section 37(1) connotes "what is paid out" and that which has gone irretrievably. In this connection, heavy reliance was placed on the judgment of this court in the case of Indian Molasses Company P. Ltd. (1959] 37 ITR 66. Relying on the said judgment, it was sought to be argued that the increase in liability at any point of time prior to the date of payment cannot be said to have gone irretrievably as it can always come back. According to the learned counsel, in the case of increase in liability due to foreign exchange Page 28 of 40 I.T.A .No.-2808 & 2898/Del/200…

DCIT Circle 12 (1) vs. G.E. Capital Services India

In the result, the appeals of the assessee and Revenue are partly allowed for

ITA 2808/DEL/2007[2001-2002]Status: DisposedITAT Delhi06 Jun 2016AY 2001-2002

Bench: Smt Diva Singh & Sh.L.P.Sahu

Section 14ASection 234DSection 45J

…ent before us was that the word "expenditure" in section 37(1) connotes "what is paid out" and that which has gone irretrievably. In this connection, heavy reliance was placed on the judgment of this court in the case of Indian Molasses Company P. Ltd. (1959] 37 ITR 66. Relying on the said judgment, it was sought to be argued that the increase in liability at any point of time prior to the date of payment cannot be said to have gone irretrievably as it can always come back. According to the learned counsel, in the case of increase in liability due to foreign exchange Page 28 of 40 I.T.A .No.-2808 & 2898/Del/200…