J.K.Industries v. UOI

297 ITR 176Supreme Court of India2008#2213 most cited

What is J.K.Industries v. UOI authority for?

Expenditure claimed as purely compensatory to offset cost overrun is allowable if it aligns with the principle of matching the expenditure to the income it relates to.

52

judgments rely on this decision, according to BharatTax’s citation analysis of 366,314 Indian tax judgments — from 2008 to 2025.

Also referred to as

J.K. Industries v. UOI · 297 ITR 176 · compensatory expenditure · cost overrun · matching concept · business expenditure · deductible expenses · income tax act

Sections most often in play

Section 143(3)Section 2(24)(x)Section 36(1)(va)

Issues it is cited on

section 23aretention moneysection 145(1)section 211section 115baasection 28(iv)section 145(2)project completion methodsection 43csection 35dpercentage completion methodsection 129

Judgments citing J.K.Industries v. UOI

M/S Vijaya Bank Employees Housing Co-Operative Society Ltd, Bangalore vs. Assistat Commissioner of Income Tax Circle-4(2)(1), Bangalore

In the result, the appeals filed by the assessee are partly allowed, as indicated above

ITA 770/BANG/2018[2012-13]Status: DisposedITAT Bangalore01 Apr 2021AY 2012-13

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Sri.V.Chandrashekar, AdvocateFor Respondent: Ms.Neera Malhotra, CIT-DR
Section 143(3)Section 148

…e assessee-society. Therefore, based on the principle of matching concept, the expenditure attributable to income ought to be allowed. In this regard reliance is placed on the judgment of the Hon’ble Apex Court in the case of J.K.Industries v. UOI reported on 297 ITR 176 (SC), wherein the Hon’ble Supreme Court had held as follows:- “The object of incurring expenses is to produce revenue. In measuring the income for a period, revenue is to be adjusted against expenses incurred for producing that revenue. This concept of adjusting / offsetting the expenses against revenue is the matching principle.” 12.6 The above…

M/S Vijaya Bank Employees Housing Tax Co-Operative Society Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-10(1), Bangalore

In the result, the appeals filed by the assessee are partly allowed, as indicated above

ITA 769/BANG/2018[2011-12]Status: DisposedITAT Bangalore01 Apr 2021AY 2011-12

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Sri.V.Chandrashekar, AdvocateFor Respondent: Ms.Neera Malhotra, CIT-DR
Section 143(3)Section 148

…e assessee-society. Therefore, based on the principle of matching concept, the expenditure attributable to income ought to be allowed. In this regard reliance is placed on the judgment of the Hon’ble Apex Court in the case of J.K.Industries v. UOI reported on 297 ITR 176 (SC), wherein the Hon’ble Supreme Court had held as follows:- “The object of incurring expenses is to produce revenue. In measuring the income for a period, revenue is to be adjusted against expenses incurred for producing that revenue. This concept of adjusting / offsetting the expenses against revenue is the matching principle.” 12.6 The above…

M/S Vijaya Bank Employees Housing Co-Operative Society Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-10(1), Bangalore

In the result, the appeals filed by the assessee are partly allowed, as indicated above

ITA 768/BANG/2018[2009-10]Status: DisposedITAT Bangalore01 Apr 2021AY 2009-10

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Sri.V.Chandrashekar, AdvocateFor Respondent: Ms.Neera Malhotra, CIT-DR
Section 143(3)Section 148

…e assessee-society. Therefore, based on the principle of matching concept, the expenditure attributable to income ought to be allowed. In this regard reliance is placed on the judgment of the Hon’ble Apex Court in the case of J.K.Industries v. UOI reported on 297 ITR 176 (SC), wherein the Hon’ble Supreme Court had held as follows:- “The object of incurring expenses is to produce revenue. In measuring the income for a period, revenue is to be adjusted against expenses incurred for producing that revenue. This concept of adjusting / offsetting the expenses against revenue is the matching principle.” 12.6 The above…

M/S Viijaya Bank Employees Housing Co-Operative Society Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-10(1), Bangalore

In the result, the appeals filed by the assessee are partly allowed, as indicated above

ITA 767/BANG/2018[2008-09]Status: DisposedITAT Bangalore01 Apr 2021AY 2008-09

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Sri.V.Chandrashekar, AdvocateFor Respondent: Ms.Neera Malhotra, CIT-DR
Section 143(3)Section 148

…e assessee-society. Therefore, based on the principle of matching concept, the expenditure attributable to income ought to be allowed. In this regard reliance is placed on the judgment of the Hon’ble Apex Court in the case of J.K.Industries v. UOI reported on 297 ITR 176 (SC), wherein the Hon’ble Supreme Court had held as follows:- “The object of incurring expenses is to produce revenue. In measuring the income for a period, revenue is to be adjusted against expenses incurred for producing that revenue. This concept of adjusting / offsetting the expenses against revenue is the matching principle.” 12.6 The above…

M/S Vijaya Bank Employees Housing Co-Operative Society Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-10(1), Bangalore

In the result, the appeals filed by the assessee are partly allowed, as indicated above

ITA 766/BANG/2018[2007-08]Status: DisposedITAT Bangalore01 Apr 2021AY 2007-08

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Sri.V.Chandrashekar, AdvocateFor Respondent: Ms.Neera Malhotra, CIT-DR
Section 143(3)Section 148

…e assessee-society. Therefore, based on the principle of matching concept, the expenditure attributable to income ought to be allowed. In this regard reliance is placed on the judgment of the Hon’ble Apex Court in the case of J.K.Industries v. UOI reported on 297 ITR 176 (SC), wherein the Hon’ble Supreme Court had held as follows:- “The object of incurring expenses is to produce revenue. In measuring the income for a period, revenue is to be adjusted against expenses incurred for producing that revenue. This concept of adjusting / offsetting the expenses against revenue is the matching principle.” 12.6 The above…

Dabur Invest Corp, New Delhi vs. JCIT, Range-46, New Delhi

In the result, appeal of the assessee is partly allowed

ITA 8058/DEL/2018[2015-16]Status: DisposedITAT Delhi11 Feb 2021AY 2015-16

Bench: Shri Sudhanshu Srivastava & Shri Prashant Maharishi(Partially Through Video Conferencing) Dabur Invest Corp, The Joint Commissioner Of Vs. 4Th Floor, Punjabi Bhawan, 10, Income Tax , Rouse Avenue, New Delhi Range-46, Pan: Aaadfd2529G New Delhi (Appellant) (Respondent)

For Appellant: Shri M. P. Rastogi, AdvFor Respondent: Shri G. C. Srivastava, Adv
Section 143Section 4

…other provisions of the Act concerning the method of accounting to be followed. The coordinate Bench went into further depth to examine the relevance of Accounting Standards issued by the ICAI including the decision in the case of J.K. Industries v. UOI 2008/ 297 ITR 176 (SC). These standards too place heavy reliance on the principle of substance over form as major consideration for the selection of accounting policies. Both the set of Accounting Standards are legally binding and are in complete harmony regarding the concept of‟ accrual‟ in preparation and presentation of financial statements. The coordinate benc…

M/S. Veerabhadrappa Sangappa & Company, Sandur vs. The Assistant Commissioner of Income Tax, Circle- 1, Bellary

In the result appeal filed by assessee stands partly allowed

ITA 1054/BANG/2019[2013-14]Status: DisposedITAT Bangalore08 Dec 2020AY 2013-14

Bench: Shri. B. R. Baskaran & Smt. Beena Pillaiassessment Year : 2013–14

For Appellant: Shri Chythanya K.K, AdvocateFor Respondent: Shri Muzaffar Hussain, CIT
Section 145Section 28Section 5

…2 ITR 254, wherein, Hon’ble Court held that, profits and gains of previous year are required to be computed in accordance with relevant accounting standard. Referring to decision of Hon’ble Supreme Court in case of JK industries Ltd vs UOI, reported in (2008) 297 ITR 176, Ld.Counsel submitted that, rules by which inventories are to be valued are laid down in accounting standards , and are to be followed in determination of accounting income mandatorily. He submitted that Hon’ble Court also held that; “8. Finally, adoption of accounting standards and of accounting income as ‘taxable income’ would avoid distortion…

The Commissioner of Income-Tax vs. Karnataka Power Transmission

In the result, the appeal fails

ITA/196/2013HC Karnataka21 Oct 2020

Bench: ALOK ARADHE,H.T. NARENDRA PRASAD

Section 143(3)Section 260Section 260ASection 263

…1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF OCTOBER 2020 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASAD I.T.A. NO.196 OF 2013 BETWEEN: 1. THE COMMISSIONER OF INCOME-TAX C.R.BUILDING QUEENS ROAD BANGALORE. 2. THE ASST. COMMISSIONER OF INCOME TAX CIRCLE - 11 (5) RASHTROTHANA BHAVAN NRUPATHUNGA ROAD BANGALORE. ... APPELLANTS (BY Mr.K.V.ARAVIND, ADV.,) AND: KARNATAKA POWER TRANSMISSION CORPORATION LTD., 7TH FLOOR, KAVERI BHAVAN K.G.ROAD BANGALORE - 560 009 ... RESPONDENT (BY Mr.K.K.CHYTHANYA, ADV.) - - -…

M/S Yokogawa India Ltd vs. The Deputy Commissioner

In the result, the appeal is disposed of

ITA/87/2012HC Karnataka04 Jun 2020

Bench: ALOK ARADHE,HEMANT CHANDANGOUDAR

Section 115JSection 143(1)Section 143(2)Section 260Section 260A

…for the purposes of this Section, book profit means the profit as shown in the statement of profit and loss account for the relevant previous years prepared under sub-Section(2). The supreme court in ‘J.K.INDUSTRIES LTD. VS. UNION OF INDIA’, (2008) 297 ITR 176 (SC) has held that books of account do not include balance sheet and profit and loss account. It has further been held that balance sheet and profit and loss account are financial statements. Section 10A of the Act permits a newly established undertaking in Free Trade Zone to claim a deduction from profits as are derived by an undertaking…

General Motors Overseas Corporation, Mumbai vs. Deputy Director of Income Tax (International Taxation) 3(1), Mumbai

In the result, the appeal of the assessee is partly allowed

ITA 381/MUM/2018[2010-11]Status: DisposedITAT Mumbai06 Mar 2020AY 2010-11

Bench: Shri Laliet Kumar & Shri M. Balaganesha.Y : 2004-05 :

For Appellant: S.K. Aggarwal Advocate For AssesseeFor Respondent: Avinish Tiwari DR for Revenue
Section 234BSection 44DSection 92

…llant relied on the following decisions : 1) Raymond Ltd. v. Deputy Commissioner of Income Tax (86-ITD-791) 2) Intertek Testing Services India Pvt. Ltd. (AAR 760 of 2007) 3) ISRO Satellite Centre [ISAC] (AAR 765 of 2007) 4) De Beers India Minerals Pvt. Ltd. (297 ITR 176) 5) M/s. Cushman & Wakefield (S) Pte. Ltd. (218 CTR 238) 8.1 The appellant further submitted that GMIL has a separate “Technical Information & Assistance Agreement” with M/s. Adam Opel AG, a company incorporated in Germany. As per the said agreement, M/s. Adam Opel AG is to provide technology license and technical assistance, technical personnel…

General Motors Overseas Corporation, Gurgaon vs. DDIT (It) 3(1), Mumbai

In the result, the appeal of the assessee is partly allowed

ITA 2787/MUM/2014[2008-09]Status: DisposedITAT Mumbai06 Mar 2020AY 2008-09

Bench: Shri Laliet Kumar & Shri M. Balaganesha.Y : 2004-05 :

For Appellant: S.K. Aggarwal Advocate For AssesseeFor Respondent: Avinish Tiwari DR for Revenue
Section 234BSection 44DSection 92

…llant relied on the following decisions : 1) Raymond Ltd. v. Deputy Commissioner of Income Tax (86-ITD-791) 2) Intertek Testing Services India Pvt. Ltd. (AAR 760 of 2007) 3) ISRO Satellite Centre [ISAC] (AAR 765 of 2007) 4) De Beers India Minerals Pvt. Ltd. (297 ITR 176) 5) M/s. Cushman & Wakefield (S) Pte. Ltd. (218 CTR 238) 8.1 The appellant further submitted that GMIL has a separate “Technical Information & Assistance Agreement” with M/s. Adam Opel AG, a company incorporated in Germany. As per the said agreement, M/s. Adam Opel AG is to provide technology license and technical assistance, technical personnel…

General Motors Overseas Corporation, Gurgaon vs. DDIT (It) 3(1), Mumbai

In the result, the appeal of the assessee is partly allowed

ITA 1986/MUM/2014[2009-10]Status: DisposedITAT Mumbai06 Mar 2020AY 2009-10

Bench: Shri Laliet Kumar & Shri M. Balaganesha.Y : 2004-05 :

For Appellant: S.K. Aggarwal Advocate For AssesseeFor Respondent: Avinish Tiwari DR for Revenue
Section 234BSection 44DSection 92

…llant relied on the following decisions : 1) Raymond Ltd. v. Deputy Commissioner of Income Tax (86-ITD-791) 2) Intertek Testing Services India Pvt. Ltd. (AAR 760 of 2007) 3) ISRO Satellite Centre [ISAC] (AAR 765 of 2007) 4) De Beers India Minerals Pvt. Ltd. (297 ITR 176) 5) M/s. Cushman & Wakefield (S) Pte. Ltd. (218 CTR 238) 8.1 The appellant further submitted that GMIL has a separate “Technical Information & Assistance Agreement” with M/s. Adam Opel AG, a company incorporated in Germany. As per the said agreement, M/s. Adam Opel AG is to provide technology license and technical assistance, technical personnel…

General Motors Overseas Corporation vs. ACIT (It) 3(1), Mumbai

In the result, the appeal of the assessee is partly allowed

ITA 1282/MUM/2009[2004-2005]Status: DisposedITAT Mumbai06 Mar 2020AY 2004-2005

Bench: Shri Laliet Kumar & Shri M. Balaganesha.Y : 2004-05 :

For Appellant: S.K. Aggarwal Advocate For AssesseeFor Respondent: Avinish Tiwari DR for Revenue
Section 234BSection 44DSection 92

…llant relied on the following decisions : 1) Raymond Ltd. v. Deputy Commissioner of Income Tax (86-ITD-791) 2) Intertek Testing Services India Pvt. Ltd. (AAR 760 of 2007) 3) ISRO Satellite Centre [ISAC] (AAR 765 of 2007) 4) De Beers India Minerals Pvt. Ltd. (297 ITR 176) 5) M/s. Cushman & Wakefield (S) Pte. Ltd. (218 CTR 238) 8.1 The appellant further submitted that GMIL has a separate “Technical Information & Assistance Agreement” with M/s. Adam Opel AG, a company incorporated in Germany. As per the said agreement, M/s. Adam Opel AG is to provide technology license and technical assistance, technical personnel…

DCIT vs. M/S Jupiter Capial Pvt. Ltd

In the result, appeal of the Revenue is partly allowed

ITA 1595/BANG/2013[2010-11]Status: DisposedITAT Bangalore13 Dec 2019AY 2010-11

Bench: Shri A. K. Garodia & Shri Pavan Kumar Gadaleassessment Year : 2010-11 Dcit, Circle 11(5), M/S. Jupiter Capital (P) Ltd., Bengaluru-560001. No. 54, Richmond Road, Vs. Bengaluru-560025. Pan : Aabcj 5666 R Appellant Respondent Revenue By : Shri. Pradeep Kumar, Jcit (Dr)(Itat), Bengaluru Assessee By : Smt. Pratibha, Advocate Date Of Hearing : 13.11.2019 Date Of Pronouncement : 13.12.2019

For Appellant: Smt. Pratibha, AdvocateFor Respondent: Shri. Pradeep Kumar, JCIT (DR)(ITAT), Bengaluru
Section 14ASection 36(1)Section 36(1)(iii)

…isallowed u/s. 36(1)(iii) of the Act. Reliance was also placed on the decision of Punjab & Haryana Cowl in the case of Abhishek Industries Ltd. (286 ITR 1) and the decision of the Hon'ble Supreme Court in the case of M/s. JK Industries Vs. Union of India (SC) 297 ITR 176, wherein it is held that disallowance of interest can be made on borrowed capital when the commercial expediency of utilization of such loan was not specified and proved by the assessee. Accordingly, the indirect interest debited to Rs.1,71,07,416/- was disallowed protectively, which would come into operation if any of the interest amounts are no…

Safal Engineers & Associates, Ahmedabad vs. The ACIT (OSD), Circle-9, Ahmedabad

In the result, assessee’s appeal is allowed

ITA 108/AHD/2015[2008-09]Status: DisposedITAT Ahmedabad01 Apr 2019AY 2008-09

Bench: Shri Pramod Kumar & Ms. Madhumita Roy

For Appellant: Shri P. M. Mehta, A.RFor Respondent: Shri Shiv Sewak, Sr. D.R
Section 143(1)Section 143(2)Section 143(3)

…earned CIT(A). The Learned AR relied upon the judgment passed by the Hon’ble Supreme Court in the matter of CIT-vs-Bilahari Investment Pvt. Ltd. reported in [2008] 299 ITR 1 (SC), J.K. Industries Ltd and another-vs-Union of India and others reported in [2008] 297 ITR 176 (SC) and also in the matter passed by the Hon’ble Supreme Court in the matter of CIT- vs-Woodward Governor India Pvt. Ltd. reported in [2009] 312 ITR 254 (SC). The Learned Departmental representative, however, relied upon the order passed by the authorities below. 4. We have heard the respective parties and perused the relevant materials availab…

DCIT, New Delhi vs. M/S. Sistema Shyam Teleservices Ltd., New Delhi

In the result Appeal of the ld AO is dismissed

ITA 732/DEL/2016[2010-11]Status: DisposedITAT Delhi25 Jan 2019AY 2010-11

Bench: Shri Amit Shukla & Shri Prashant Maharishidcit, Vs. Sistema Shyam Circle-23(2), Teleservices Ltd, New Delhi A-60, Naraina Industrial Area-I, New Delhi Pan: Aaccs1709H (Appellant) (Respondent)

For Appellant: Shri Alok Vasant, CAFor Respondent: Shri Surender Pal, Sr. DR
Section 143(3)Section 144C

…t. The aforesaid legal position would meet the argument of the Revenue that the prepaid amount received was not liable to be refunded or repaid, whether or not any services were rendered. 18. In J.K. Industries Ltd. and Anr. Vs. Union of India and Ors. [2008] 297 ITR 176 (SC) and Commissioner of Income Tax Vs. Woodward Governor India P. Ltd. [2009] 312 ITR 254 (SC), the Supreme Court has emphasized that the accounting standards as framed and followed by the auditors should be respected, for they provide harmonization of concepts and accounting principles and ensure discipline. Accounting methods followed continuo…

Pr. Commissioner of Income Tax-8 vs. Sistema Shyam Teleservices Ltd

The appeals are disposed of

ITA/1069/2017HC Delhi15 Nov 2018

Bench: HON'BLE MR. JUSTICE SANJIV KHANNA,HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI

Section 260A

…esaid legal position would meet the argument of the Revenue that the prepaid amount received was not liable to be refunded or repaid, whether or not any services were rendered. 18. In J.K. Industries Ltd. and Anr. Vs. Union of India and Ors. [2008] 297 ITR 176 (SC) and Commissioner of Income Tax Vs. Woodward Governor India P. Ltd. [2009] 312 ITR 254 (SC), the Supreme Court has emphasized that the accounting standards as framed and followed by the auditors should be respected, for they provide harmonization of concepts and accounting principles and ensure discipline. Accounting methods followed co…

Commissioner of Income Tax-III vs. Shyam Telelink Ltd

The appeals are disposed of

ITA/70/2013HC Delhi15 Nov 2018

Bench: HON'BLE MR. JUSTICE SANJIV KHANNA,HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI

Section 260A

…esaid legal position would meet the argument of the Revenue that the prepaid amount received was not liable to be refunded or repaid, whether or not any services were rendered. 18. In J.K. Industries Ltd. and Anr. Vs. Union of India and Ors. [2008] 297 ITR 176 (SC) and Commissioner of Income Tax Vs. Woodward Governor India P. Ltd. [2009] 312 ITR 254 (SC), the Supreme Court has emphasized that the accounting standards as framed and followed by the auditors should be respected, for they provide harmonization of concepts and accounting principles and ensure discipline. Accounting methods followed co…

Commissioner of Income Tax-III vs. Shyam Telelink Ltd

The appeals are disposed of

ITA/73/2013HC Delhi15 Nov 2018

Bench: HON'BLE MR. JUSTICE SANJIV KHANNA,HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI

Section 260A

…esaid legal position would meet the argument of the Revenue that the prepaid amount received was not liable to be refunded or repaid, whether or not any services were rendered. 18. In J.K. Industries Ltd. and Anr. Vs. Union of India and Ors. [2008] 297 ITR 176 (SC) and Commissioner of Income Tax Vs. Woodward Governor India P. Ltd. [2009] 312 ITR 254 (SC), the Supreme Court has emphasized that the accounting standards as framed and followed by the auditors should be respected, for they provide harmonization of concepts and accounting principles and ensure discipline. Accounting methods followed co…

Mr.M.J Aravind, Bangalore vs. Joint Commissioner of Income-Tax, Bangalore

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

ITA 1991/BANG/2016[2012-13]Status: DisposedITAT Bangalore20 Apr 2018AY 2012-13

Bench: Shri N.V. Vasudevan & Shri Arun Kumar Garodiaassessment Year :2012-13

For Appellant: Shri Shyam Ramadhyani, CAFor Respondent: Shri B.R. Ramesh, JCIT (DR)
Section 14ASection 48Section 57

…penses when we have claimed are all attributable to the earning of the income. In fact we have already) provided the detailed explanation in this regard b) The principle of matching concept has been enunciated by the apex court in the case of J.K. Industries 297 ITR 176 where in it has been held the revenues for the period have to be matched with the costs or expenses of that period. Thus all expenses attributable to income have to be given deduction. We have ourselves applied section 14 A of the act and have removed expenses on account of exempt income. Though the same is not required for purpose of section 57…