Kedarnath Jute Mfg. Co. Ltd. v. CIT

82 ITR 363Supreme Court of India1971#89 most cited

What is Kedarnath Jute Mfg. Co. Ltd. v. CIT authority for?

Tax liability for an item of income or expenditure is determined solely by the provisions of the Income-tax Act. Entries in an assessee's books of account are not conclusive and do not govern the taxability or deductibility of an item, as the legal rights and obligations under the Act prevail.

654

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 1998 to 2026.

Also referred to as

Kedarnath Jute Mfg. Co. Ltd. v. CIT · 82 ITR 363 SC · tax liability · accounting entries · books of account · Income-tax Act provisions · tax law vs accounting · section 145 · mercantile system · book profits · section 115JB · section 37(1) · section 43B

Sections most often in play

Section 143(3)Section 1961Section 37(1)Section 43BSection 14ASection 115JBSection 143(1)Section 145
Read the full judgment

Issues it is cited on

section 80hhcsection 80hhbook profitsrevenue expendituresection 80iamercantile system of accountingcapital expendituresection 115jsection 80idisallowance under section 14asection 37(1)section 115jb

Judgments citing Kedarnath Jute Mfg. Co. Ltd. v. CIT

M/S Aggarwal & Modi Enterprises vs. The Commissioner of Income Tax

ITA - 354 / 2003HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

M/S Aggarwal & Modi Enterprise vs. The Commissioner of Income Tax

ITA - 355 / 2003HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

M/S Aggarwal & Modi Enterprise vs. Commissioner of Income Tax

ITA - 769 / 2006HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

Aggarwal & Modi Enterprises Pv vs. C.I.T

ITA - 770 / 2006HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

M/S Aggarwal & Modi Enterprise vs. Commissioner of Income Tax

ITA - 876 / 2006HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

Aggarwal & Modi Enterpises Co vs. Commissioner of Income Tax

ITA - 1123 / 2007HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

M/S Aggarwal & Modi Enterprises Pvt Ltd vs. Commissioner of Income Tax

ITA - 1273 / 2009HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

M/S Aggarwal & Modi Enterprises vs. Commissioner of Income Tax

ITA - 1277 / 2009HC Delhi21 Jan 2016

…with the Assessee that the amounts payable to NDMC towards liability had already accrued and deleted the addition made by the AO. The CIT (A) referred to the decision in Kedarnath Jute Manufacturing Co. Ltd. v. Additional Commissioner of Income Tax (1971) 82 ITR 363 (SC). 2016:DHC:494-DB ITA Nos.353, 354, 355/2003; 767, 769, 770, 801, 876/2006; 1122, 1123/2007; 1273, 1274, 1277/2009 Page 13 of 31 19. Aggrieved by the order of the CIT (A), the Revenue went in appeal before the ITAT. By an order dated 31st October 2002 the ITAT reversed the order of the CIT (A) sustaining the additions…

Graphite India Ltd., Kolkata vs. Addi. Commissioner of Incime Tax, Range - 11, Kolkata

In the result, the appeal of the assessee is partly allowed as indicated above

ITA 397/KOL/2008[1998-99]Status: DisposedITAT Kolkata15 Jan 2016AY 1998-99

Bench: Shri P.M. Jagtap & Shri S.S. Viswanethra Ravi

…ported in 349 ITR 336. Moreover, the entries in the books of account are not conclusive for deciding the claim of the assessee for any deduction as held by the Hon’ble Supreme Court in the case of Kedarnath Jute Manufacturing Co. Limited –vs.- CIT reported in 82 ITR 363 and since the relevant details were furnished by the assessee before the Assessing Officer as well as before the ld. CIT(Appeals) in support of its claim on this issue as submitted by the ld. Counsel for the assessee, we are of the view that the ld. CIT(Appeals) ought to have decided this issue on merit. I.T.A. No. 397/KOL./2008 Assessment year:…

Damodar Valley Corporation, Kolkata vs. Addl. CIT, Range - 9, Kolkata

Accordingly, the ground nos. 8 & 9 in ITA No. 451/Kol/2013 raised by the assessee are allowed

ITA 1622/KOL/2011[2008-09]Status: DisposedITAT Kolkata13 Jan 2016AY 2008-09

Bench: : Shri N.V. Vasudevan & Shri M. Balaganeshita No. 1622/Kol/2011 A.Y 2008-09

For Appellant: Shri D.S Damle, FCA, ld.ARFor Respondent: Shri Rajat Subhra Biswas, CIT, ld
Section 115JSection 143(3)

…the purchase tax under the said Act. It is also significant to note that the assessee’s entitlement to claim deduction had been held to be valid in view of an earlier judgement of the Supreme Court in Kedarnath Jute Manufacturing Company Limited vs CIT (1971) 82 ITR 363. This was, therefore, a case of error in perception / judgement. Despite the same, the Supreme Court upheld the decision of the Appellate Assistant Commissioner in allowing the deduction. The words “could not have been raised” must, therefore, be construed liberally and not strictly. 17. The next judgement to which our attention was invited by Mr…

DCIT, New Delhi vs. M/S Alcobex Metals Ltd., New Delhi

In the result, appeal filed by the revenue is dismissed

ITA 5344/DEL/2010[2003-04]Status: DisposedITAT Delhi12 Jan 2016AY 2003-04

Bench: Shri A.T.Varkey & Shri L.P. Sahu

For Appellant: Shri Gautam Jain, AdvocateFor Respondent: Shri K.K. Jaiswal, Senior DR
Section 10(2)(xv)

…le for deduction in the instant year. The learned AR however supported the finding of the CIT(A) by relying upon the judgment of the Apex Court in the case of India Cements Ltd. vs. CIT 60 ITR 52 and also in the case of Kedarnath Jute Mfg. Co. Ltd. vs. CIT - 82 ITR 363. 5. We have considered the rival submissions and perused the material on record. We take note that CIT(A) has deleted the disallowance of Rs.28,42,760/- by holding as under: “It cannot be appreciated that how the Ld. AO has taken the expenditure as capital or as a contingent liability. The said expenditure was paid to the bank for taking of loan…

DCIT, New Delhi vs. M/S. Encorp E Services Ltd., New Delhi

In the result, the appeals of the department are dismissed

ITA 4461/DEL/2011[2007-08]Status: DisposedITAT Delhi11 Jan 2016AY 2007-08

Bench: Sh. N. K. Saini, Am & Sh. Kuldip Singh, Jm Ita No. 1799/Del/2011 : Asstt. Year : 2005-06 Dy. Commissioner Of Income Vs M/S Encorp E Services Ltd., Tax, Circle-11(1), M-4, Surya Mansion, Kausalya Park, New Delhi New Delhi-110016 (Appellant) (Respondent) Ita Nos. 4460 & 4461/Del/2011 : Asstt. Years : 2006-07 & 2007-08 Dy. Commissioner Of Income Vs M/S Encorp E Services Ltd., Tax, Circle-11(1), Office No. 202, F-46, Bhagat Singh New Delhi Market, New Delhi-110001 (Appellant) (Respondent) Pan No. Aabce3129L Assessee By : Sh. Anoop Sharma, Adv. Revenue By : Ms. Kesang Y. Shirpa, Sr. Dr Date Of Hearing : 26.10.2015 Date Of Pronouncement : 11.01.2016 Order Per N. K. Saini, Am:

For Appellant: Sh. Anoop Sharma, AdvFor Respondent: Ms. Kesang Y. Shirpa, Sr. DR
Section 143(1)

…e purchasing market is short and advertisement is needed from year to year and cannot be made once for all in any single particular year. The tribunal was justified in law in allowing the sum as revenue expenditure. Kedar Nath Jute Mfg. Co. Ltd. Vs CIT (1971) 82 ITR 363 (SC) and CIT Vs India Discount Co. Ltd. Vs CIT (1970) 75 ITR 1991 (SC). (v) Respectfully following the above case laws it is prayed that the disallowance of Rs.1,64,99,137/- made by the AO out of advertisement expenses may kindly be deleted.” 7. The ld. CIT(A) after considering the submissions of the assessee observed that the partywise and monthw…

DCIT, New Delhi vs. M/S Encorp E Service Ltd., New Delhi

In the result, the appeals of the department are dismissed

ITA 1799/DEL/2011[2005-06]Status: DisposedITAT Delhi11 Jan 2016AY 2005-06

Bench: Sh. N. K. Saini, Am & Sh. Kuldip Singh, Jm Ita No. 1799/Del/2011 : Asstt. Year : 2005-06 Dy. Commissioner Of Income Vs M/S Encorp E Services Ltd., Tax, Circle-11(1), M-4, Surya Mansion, Kausalya Park, New Delhi New Delhi-110016 (Appellant) (Respondent) Ita Nos. 4460 & 4461/Del/2011 : Asstt. Years : 2006-07 & 2007-08 Dy. Commissioner Of Income Vs M/S Encorp E Services Ltd., Tax, Circle-11(1), Office No. 202, F-46, Bhagat Singh New Delhi Market, New Delhi-110001 (Appellant) (Respondent) Pan No. Aabce3129L Assessee By : Sh. Anoop Sharma, Adv. Revenue By : Ms. Kesang Y. Shirpa, Sr. Dr Date Of Hearing : 26.10.2015 Date Of Pronouncement : 11.01.2016 Order Per N. K. Saini, Am:

For Appellant: Sh. Anoop Sharma, AdvFor Respondent: Ms. Kesang Y. Shirpa, Sr. DR
Section 143(1)

…e purchasing market is short and advertisement is needed from year to year and cannot be made once for all in any single particular year. The tribunal was justified in law in allowing the sum as revenue expenditure. Kedar Nath Jute Mfg. Co. Ltd. Vs CIT (1971) 82 ITR 363 (SC) and CIT Vs India Discount Co. Ltd. Vs CIT (1970) 75 ITR 1991 (SC). (v) Respectfully following the above case laws it is prayed that the disallowance of Rs.1,64,99,137/- made by the AO out of advertisement expenses may kindly be deleted.” 7. The ld. CIT(A) after considering the submissions of the assessee observed that the partywise and monthw…

M/S Dalmia Cement (Bharat) Ltd vs. The Commissioner of Income Tax

The appeal is partly allowed

ITA-374/2003HC Delhi23 Dec 2015
For Appellant: Mr Simran MehtaFor Respondent: Mr N.P. Sahni, Senior Standing Counsel for
Section 115Section 116Section 260ASection 32A(1)

…tion was admissible on account of the liability to pay cess or cess charge would have to be determined on the basis whether such a liability had accrued at the material time. The decision of the Supreme Court in Kedarnath Jute Mfg. Co. Ltd. v. CIT: (1971) 82 ITR 363 (SC) explains this principle in the following words:- “We are wholly unable to appreciate the suggestion that if an assessee under some misapprehension or mistake fails to make an entry in the books of account and although under the law, a deduction must be allowed by the Income Tax Officer, the assessee will lose the right of claiming or wi…

M/S Dalmia Cement (Bharat) Ltd vs. The Commissioner of Income Tax

The appeal is partly allowed

ITA - 374 / 2003HC Delhi23 Dec 2015
For Appellant: Mr Simran MehtaFor Respondent: Mr N.P. Sahni, Senior Standing Counsel for
Section 115Section 116Section 260ASection 32A(1)

…tion was admissible on account of the liability to pay cess or cess charge would have to be determined on the basis whether such a liability had accrued at the material time. The decision of the Supreme Court in Kedarnath Jute Mfg. Co. Ltd. v. CIT: (1971) 82 ITR 363 (SC) explains this principle in the following words:- “We are wholly unable to appreciate the suggestion that if an assessee under some misapprehension or mistake fails to make an entry in the books of account and although under the law, a deduction must be allowed by the Income Tax Officer, the assessee will lose the right of claiming or wi…

M/S Dalmia Cement (Bharat) Ltd vs. The Commissioner of Income Tax

The appeal is partly allowed

ITA/374/2003HC Delhi23 Dec 2015
For Appellant: Mr Simran MehtaFor Respondent: Mr N.P. Sahni, Senior Standing Counsel for
Section 115Section 116Section 260ASection 32A(1)

…tion was admissible on account of the liability to pay cess or cess charge would have to be determined on the basis whether such a liability had accrued at the material time. The decision of the Supreme Court in Kedarnath Jute Mfg. Co. Ltd. v. CIT: (1971) 82 ITR 363 (SC) explains this principle in the following words:- “We are wholly unable to appreciate the suggestion that if an assessee under some misapprehension or mistake fails to make an entry in the books of account and although under the law, a deduction must be allowed by the Income Tax Officer, the assessee will lose the right of claiming or wi…

ACIT, Circle - 7, Kolkata vs. C.D. Equifinance Pvt. Ltd., Kolkata

In the result, all the appeals filed by the Revenue are dismissed, while the appeal of the assessee is allowed

ITA 1790/KOL/2008[2005-06]Status: DisposedITAT Kolkata09 Dec 2015AY 2005-06

Bench: Shri P.M. Jagtap & Shri S.S. Viswanethra Ravi

Section 10(38)

…purchased with an intention to sale them at a profit. Therefore, the treatment given by the assessee to these shares/units in the books of account is not material. The Hon'ble Supreme Court in the cases of Kedarnath Jute Manufacturing Co. Ltd. vs. CIT [1971] 82 ITR 363 (SC) and Sutlej Cotton Mills Ltd. vs. CIT [1979] 116 ITR 1 (SC) has held that accounting entries alone are not determinative of the exact nature, character and scope of the transactions. 7(a). The assessee has received speculation profit of Rs.3,17,35,947/-. This profit has been earned by the assessee in "Futures and Options" transactions. The tr…

Addl Cirt G 3(2), Mumbai vs. Aditya Birla Nuvo Ltd, Mumbai

Appeal of the assessee is partly allowed

ITA 3178/MUM/2012[2008-09]Status: DisposedITAT Mumbai09 Dec 2015AY 2008-09
For Appellant: Shri J.D. MistriFor Respondent: Shri E. Sankaran-CIT(DR)
Section 143(3)Section 145Section 14ASection 254(1)

…the spares were procured as back as 1986 but capitalized now because of the change in the accounting standards. The assessee relying on the decision of the Hon'ble Supreme Court in the case of Kedarmath Jute Mfg. Co. Ltd., v. Commissioner of Income-tax (1971) 82 ITR 363, contended that entries in the books of account cannot be decisive or conclusive, for determining the taxability of income. The assessee contended in the light of the decision of the jurisdictional High Court in the case of Anil Bulk Carriers P. Ltd. v. Commissioner of Income tax(2005) 276 ITR 625 and in the case of Commissioner of Income tax v. S…

Ici India Ltd., Kolkata vs. DCIT, Cir-10, Kolkata

In the result, Revenue’s appeal is dismissed

ITA 850/KOL/2007[1996-97]Status: DisposedITAT Kolkata27 Nov 2015AY 1996-97

Bench: Shri Mahavir Singh & Shri Waseem Ahmed

Section 143(3)

…see prayed for the allowabilty of the VRS amount. In support of its claim assessee has submitted the following case laws:- 1. CIT v. Alim Bag Salim Bhai 163 ITR 767 (MP) 2. Kalekhan Mohammed Hanif v. CIT 163 ITR 769 (MP) 3. Kedarnath Jute Mfg. Co. Ltd. v. CIT 82 ITR 363 (SC) 4. Metal Box Co. of India Ltd. v. Their Workmen 73 ITR 53 (SC) 5. ITAT, Kolkata C Bench Rallis India Ltd. v.DCIT Ld. AR also submitted that this Tribunal’s order in assessee’s own case in ITA No. 851/Kol/2008, 1018/Kol/2007 & 1640/Kol/2008 for AYs 2000-01 and 2001-02, involving the exactly similar facts where the decision was in favour of as…

DCIT, Cir-10, Kolkata vs. M/S Ici India Ltd., Kolkata

In the result, Revenue’s appeal is dismissed

ITA 1021/KOL/2007[1996-97]Status: DisposedITAT Kolkata27 Nov 2015AY 1996-97

Bench: Shri Mahavir Singh & Shri Waseem Ahmed

Section 143(3)

…see prayed for the allowabilty of the VRS amount. In support of its claim assessee has submitted the following case laws:- 1. CIT v. Alim Bag Salim Bhai 163 ITR 767 (MP) 2. Kalekhan Mohammed Hanif v. CIT 163 ITR 769 (MP) 3. Kedarnath Jute Mfg. Co. Ltd. v. CIT 82 ITR 363 (SC) 4. Metal Box Co. of India Ltd. v. Their Workmen 73 ITR 53 (SC) 5. ITAT, Kolkata C Bench Rallis India Ltd. v.DCIT Ld. AR also submitted that this Tribunal’s order in assessee’s own case in ITA No. 851/Kol/2008, 1018/Kol/2007 & 1640/Kol/2008 for AYs 2000-01 and 2001-02, involving the exactly similar facts where the decision was in favour of as…