KeshrichandJaisukhlal v. CIT

199 ITR 702High Court1993#1829 most cited

What is KeshrichandJaisukhlal v. CIT authority for?

Notional income, such as notional interest on interest-free loans, cannot be brought to tax without a specific statutory provision in the Income Tax Act. Only real income that has accrued or been received by the assessee is subject to income tax.

62

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2010 to 2024.

Also referred to as

Keshrichand Jaisukhlal v. CIT · Highways Construction Co. Pvt. Ltd. v. CIT · 199 ITR 702 · notional income · notional interest · interest-free loans · real income · taxability · section 36(1)(iii) · section 28(iv) · commercial expediency · Gauhati High Court

Sections most often in play

Section 142(1)Section 133(6)Section 143(2)Section 143(3)Section 147Section 148Section 36(1)(iii)Section 37

Issues it is cited on

section 28(iv)surrender of incomeright to receivemercantile system of accountingloose paperssection 36(1)(iii)commercial expediencysection 28section 234apenalty u/s 271(1)(c)section 133asection 131

Judgments citing KeshrichandJaisukhlal v. CIT

Shri Purshottam B. Pitroda, Ahmedabad vs. The ACIT, Circle-12, Ahmedabad

Appeal is partly allowed

ITA 567/AHD/2016[2012-13]Status: DisposedITAT Ahmedabad03 May 2019AY 2012-13

Bench: Shri Waseem Ahmed & Ms. Madhumita Roy

For Appellant: Shri A. C. Shah & Bhaumil K. Patel, A.RFor Respondent: Shri Ranjan Kumar Singh, Sr.D. R
Section 143(3)Section 36Section 36(1)(iii)

…h AO has made addition of Interest @ 10% on Rs. 25,89,060/- i.e. Rs.2,58,906/-. Whatever interest we have paid are exclusive for the purpose of Business only. Pl. Ref. Gauhati High Court in the case of Highways Construction Company Limited Vs. CIT reported in 199 ITR 702 has there is no compulsion that one must earn and if one has not earned income, notional income cannot be charged to tax. Ref -2 CIT Vs. Chelladurai reported at 204 Taxmann 258 (Mad). (Copy of Case Laws are attached). Hence disallowance of Inerest exp byAO have not direct nexus and is illegal. We have enough interest free funds inform of Unsecure…

Shri Purshottam B. Pitroda, Ahmedabad vs. The ACIT, Circle-12, Ahmedabad

Appeal is partly allowed

ITA 566/AHD/2016[2011-12]Status: DisposedITAT Ahmedabad03 May 2019AY 2011-12

Bench: Shri Waseem Ahmed & Ms. Madhumita Roy

For Appellant: Shri A. C. Shah & Bhaumil K. Patel, A.RFor Respondent: Shri Ranjan Kumar Singh, Sr.D. R
Section 143(3)Section 36Section 36(1)(iii)

…h AO has made addition of Interest @ 10% on Rs. 25,89,060/- i.e. Rs.2,58,906/-. Whatever interest we have paid are exclusive for the purpose of Business only. Pl. Ref. Gauhati High Court in the case of Highways Construction Company Limited Vs. CIT reported in 199 ITR 702 has there is no compulsion that one must earn and if one has not earned income, notional income cannot be charged to tax. Ref -2 CIT Vs. Chelladurai reported at 204 Taxmann 258 (Mad). (Copy of Case Laws are attached). Hence disallowance of Inerest exp byAO have not direct nexus and is illegal. We have enough interest free funds inform of Unsecure…

ACIT 16(1), Mumbai vs. Tips Industries Ltd, Mumbai

In the result, the appeal filed by revenue in ITA no

ITA 6291/MUM/2017[2012-13]Status: DisposedITAT Mumbai03 May 2019AY 2012-13

Bench: Shri Mahavir Singh & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No.6194 To 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 & 2013-14) बिाम/ M/S. Tips Industries Ltd., Acit 11(1) 601, Durga Chambers, Room No. 439, 6T H Floor, Linking Road, Aayakar Bhawan V. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ Pan : Aaact5284A

For Appellant: Shri. Deepak TralshawalaFor Respondent: Shri. O.P Meena (DR)
Section 143(3)Section 36(1)(iii)

…आयकर अपीऱीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER आयकर अपीऱ सं./I.T.A. No.6194 to 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 and 2013-14) बिाम/ M/s. Tips Industries Ltd., ACIT 11(1) 601, Durga Chambers, Room No. 439, 6t h Floor, Linking Road, Aayakar Bhawan v. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ PAN : AAACT5284A आयकर अपीऱ सं./ I.T.A. No. 6291/Mum/2017 (नििाारण वर्ा / Assessment Year: 2012-13) बिाम/ ACIT 16(1) M/s. Tips Industries Lt…

Tips Industries Ltd, Mumbai vs. ACIT 16(1), Mumbai

In the result, the appeal filed by revenue in ITA no

ITA 6196/MUM/2017[2013-14]Status: DisposedITAT Mumbai03 May 2019AY 2013-14

Bench: Shri Mahavir Singh & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No.6194 To 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 & 2013-14) बिाम/ M/S. Tips Industries Ltd., Acit 11(1) 601, Durga Chambers, Room No. 439, 6T H Floor, Linking Road, Aayakar Bhawan V. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ Pan : Aaact5284A

For Appellant: Shri. Deepak TralshawalaFor Respondent: Shri. O.P Meena (DR)
Section 143(3)Section 36(1)(iii)

…आयकर अपीऱीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER आयकर अपीऱ सं./I.T.A. No.6194 to 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 and 2013-14) बिाम/ M/s. Tips Industries Ltd., ACIT 11(1) 601, Durga Chambers, Room No. 439, 6t h Floor, Linking Road, Aayakar Bhawan v. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ PAN : AAACT5284A आयकर अपीऱ सं./ I.T.A. No. 6291/Mum/2017 (नििाारण वर्ा / Assessment Year: 2012-13) बिाम/ ACIT 16(1) M/s. Tips Industries Lt…

Tips Industries Ltd, Mumbai vs. ACIT 16(1), Mumbai

In the result, the appeal filed by revenue in ITA no

ITA 6195/MUM/2017[2012-13]Status: DisposedITAT Mumbai03 May 2019AY 2012-13

Bench: Shri Mahavir Singh & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No.6194 To 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 & 2013-14) बिाम/ M/S. Tips Industries Ltd., Acit 11(1) 601, Durga Chambers, Room No. 439, 6T H Floor, Linking Road, Aayakar Bhawan V. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ Pan : Aaact5284A

For Appellant: Shri. Deepak TralshawalaFor Respondent: Shri. O.P Meena (DR)
Section 143(3)Section 36(1)(iii)

…आयकर अपीऱीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER आयकर अपीऱ सं./I.T.A. No.6194 to 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 and 2013-14) बिाम/ M/s. Tips Industries Ltd., ACIT 11(1) 601, Durga Chambers, Room No. 439, 6t h Floor, Linking Road, Aayakar Bhawan v. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ PAN : AAACT5284A आयकर अपीऱ सं./ I.T.A. No. 6291/Mum/2017 (नििाारण वर्ा / Assessment Year: 2012-13) बिाम/ ACIT 16(1) M/s. Tips Industries Lt…

Tips Industries Ltd, Mumbai vs. ACIT 11(1), Mumbai

In the result, the appeal filed by revenue in ITA no

ITA 6194/MUM/2017[2011-12]Status: DisposedITAT Mumbai03 May 2019AY 2011-12

Bench: Shri Mahavir Singh & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No.6194 To 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 & 2013-14) बिाम/ M/S. Tips Industries Ltd., Acit 11(1) 601, Durga Chambers, Room No. 439, 6T H Floor, Linking Road, Aayakar Bhawan V. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ Pan : Aaact5284A

For Appellant: Shri. Deepak TralshawalaFor Respondent: Shri. O.P Meena (DR)
Section 143(3)Section 36(1)(iii)

…आयकर अपीऱीय अधिकरण “E” न्यायपीठ म ुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER आयकर अपीऱ सं./I.T.A. No.6194 to 6196/Mum/2017 (नििाारण वर्ा / Assessment Year: 2011-12, 2012-13 and 2013-14) बिाम/ M/s. Tips Industries Ltd., ACIT 11(1) 601, Durga Chambers, Room No. 439, 6t h Floor, Linking Road, Aayakar Bhawan v. Khar West, M.K.Marg Mumbai 400054 Mumbai-400020 स्थायी ऱेखा सं./ PAN : AAACT5284A आयकर अपीऱ सं./ I.T.A. No. 6291/Mum/2017 (नििाारण वर्ा / Assessment Year: 2012-13) बिाम/ ACIT 16(1) M/s. Tips Industries Lt…

Suresh Kumar Garg, New Delhi vs. ITO, Ward- 47(1), New Delhi

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

ITA 845/DEL/2018[2014-15]Status: DisposedITAT Delhi20 Feb 2019AY 2014-15

Bench: Shri R.K. Pandaassessment Year: 2014-15 Suresh Kumar Garg, Vs. Ito, 2629A, Naya Bazar, Ward-47(1), New Delhi. New Delhi. Pan: Aafpg4752Q (Appellant) (Respondent) Assessee By : Shri K. Sampath & Shri V. Raj Kumar, Advocates Revenue By : Shri S.L. Anuragi, Sr. Dr Date Of Hearing : 18.02.2019 Date Of Pronouncement : 20.02.2019

For Appellant: Shri K. Sampath &For Respondent: Shri S.L. Anuragi, Sr. DR

…wife of the assessee. Relying on the following decisions, he submitted that no notional interest can be added in the hands of the assessee:- 4 (i) Smt. Satish Bala Malhotra vs. CIT 391 ITR 256 (P&H); and (ii) Highways Construction Company Pvt. Ltd. vs. CIT, 199 ITR 702. 7. He accordingly submitted that the addition of Rs.2,95,541/- on account of notional interest made by the Assessing Officer and upheld by the CIT(A) should be deleted. 8. The ld. DR, on the other hand, heavily relied on the order of the CIT(A). He submitted that the ld.CIT(A) has given valid reasons while upholding the disallowance made by t…

Harjeet Singh Kandhari, New Delhi vs. ITO, New Delhi

Appeal of the assessee is allowed

ITA 1269/DEL/2016[2012-13]Status: DisposedITAT Delhi15 Feb 2019AY 2012-13

Bench: Shri R. K. Panda & Ms Suchitra Kambleharjeet Singh Kandhari Vs Ito C/O. R. S. Ahuja & Co. Cas Ward-53(4) C-353, Defence Colony New Delhi New Delhi Abkps7462F (Appellant) (Respondent)

Section 139(1)Section 143(1)Section 143(2)

…ose of disallowance of interest) has to be taken care of. I also find that it is well settled law that notional interest cannot be charged as held by Hon’ble Gauhati High Court in the case of Highways Constructions Co. Pvt. Ltd. Vs. Commissioner of Income Tax 199 ITR 702 and Keshrichand Jaisukhlal CJT 122 Taxman 307 (Gau). In view of the above discussions and respectfully following the precedents, as aforesaid the addition in dispute is deleted and accordingly, the ground no. 2 raised by the assessee stands allowed.” In the present year, we find from the ledger accounts of M/s R.R Designs and M/s Aura Info Tech…

Shri Manish Sood, Kolkata vs. ACIT, Circle - 30, Kolkata

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1954/KOL/2018[2010-11]Status: DisposedITAT Kolkata16 Jan 2019AY 2010-11

Bench: Sri J. Sudhakar Reddy

Section 143(3)

…d the money to these two concerns have to be looked into prior to coming to any conclusion in the matter. It is true that notional income cannot be brought to tax as held by Hon’ble Guwahati High Court in the case of Highways Construction Co. Pvt. Ltd. [1993] 199 ITR 702 which was followed by the Hon’ble Delhi High Court in the case of M/s Shivnandan Buildcon Pvt. Ltd. (supra). At the same time accrued interest has to be brought to tax. In the case in hand, this aspect was not verified by the Assessing Officer. We do not have before us the copies of the agreement or terms on which the advances/loans were given. H…

Surinder Kumar Prop., Rewari vs. ITO, Rewari

In the result, the ITA No

ITA 1612/DEL/2015[2009-10]Status: DisposedITAT Delhi05 Jul 2018AY 2009-10

Bench: Shri H.S. Sidhu & Shri N.K. Billaiya

For Appellant: NoneFor Respondent: Sh. K. Tewari, Sr. DR
Section 271(1)(c)Section 40A(3)

…e and dismiss the ground no. 2 raised by the assessee. 17. Ground no.6 is addition on account of notional interest. It is well settled law that the Hon’ble Gauhati High Court in the case of Highways Constructions Co. Pvt. Ltd. Vs. Commissioner of Income Tax 199 ITR 702 held that notional interest cannot be charged. This ground is allowed. 18. The ground no. 7 relating to confirmation of addition of Rs.95830/- is not 28 pressed before us, hence, the same is dismissed, as not pressed. 19. With regard to ground no. 8 relating to confirmation of addition of Rs. 33900/- i.e. 20% disallowances of expenses under…

Surinder Kumar Prop., Rewari vs. ITO, Rewari

In the result, the ITA No

ITA 1611/DEL/2015[2007-08]Status: DisposedITAT Delhi05 Jul 2018AY 2007-08

Bench: Shri H.S. Sidhu & Shri N.K. Billaiya

For Appellant: NoneFor Respondent: Sh. K. Tewari, Sr. DR
Section 271(1)(c)Section 40A(3)

…e and dismiss the ground no. 2 raised by the assessee. 17. Ground no.6 is addition on account of notional interest. It is well settled law that the Hon’ble Gauhati High Court in the case of Highways Constructions Co. Pvt. Ltd. Vs. Commissioner of Income Tax 199 ITR 702 held that notional interest cannot be charged. This ground is allowed. 18. The ground no. 7 relating to confirmation of addition of Rs.95830/- is not 28 pressed before us, hence, the same is dismissed, as not pressed. 19. With regard to ground no. 8 relating to confirmation of addition of Rs. 33900/- i.e. 20% disallowances of expenses under…

Ram Bilas Agarwal, Kolkata vs. ITO, Ward - 36(1), Kolkata

In the result, this appeal of the assessee is allowed

ITA 1981/KOL/2017[2013-14]Status: DisposedITAT Kolkata16 Mar 2018AY 2013-14

Bench: Sri J. Sudhakar Reddy] I.T.A. No. 1981/Kol/2017 Assessment Year: 2013-14 Ram Bilas Agarwal……………………………………………....………………..……………..….Appellant 29, R.N. Mukherjee Road Windsor House Room No.19 2Nd Floor Kolkata - 1 [Pan : Aacupa 4511 E] Income Tax Officer, Ward-36(1), Kolkata…..………………………………….……...Respondent Ayakar Bhawan(Poorva) 8Th Floor 110, Shantipally Kolkata – 700 107 Appearances By: Shri V.N. Purohit, A.R., Appeared On Behalf Of The Assessee. Shri Sanjoy Mukherjee, Addl. Cit. Dr, Appearing On Behalf Of The Revenue.

Section 143(3)Section 250

…Accordingly, Ground No.1 of the assessee is allowed for statistical purposes. 5. Ground No. 2, has to be allowed as notional interest cannot be charged. The Hon’ble Gauhati High Court in the case of High Way Construction Co.Pvt.Ltd. vs. CIT (1993) reported in 199 ITR 702, held as follows:- “There was no finding of fact by the Tribunal to the effect that actually the loan had been granted to the managing director or any other person on interest, or that interest had actually been collected and the collection of the interest was not reflected in the accounts. The finding of the ITO was that the assessee ought to ha…

ITO 9(1)(3), Mumbai vs. Anchor Residency P.Ltd, Mumbai

In the result, the appeal filed by the revenue is partly allowed

ITA 4407/MUM/2015[2011-12]Status: DisposedITAT Mumbai14 Mar 2018AY 2011-12

Bench: Shri Joginder Singh () & Shri G Manjunatha ()

Section 143(2)Section 36(1)(iii)

…Therefore, the AO was incorrect in disallowing interest by estimating 9 ITA 4407/Mum/2015 notional interest on advances. In this regard, he relied upon the decision of Hon’ble Gujarat High Court in the case of Highway Construction Co Pvt Ltd vs CIT (1993) 199 ITR 702 (SC) and the decision of Hon’ble Bombay High Court in the case of CIT vs Sesa Resources Ltd (2017) 85 Taxman.com 88. The assessee also relied upon the following case laws with head notes:- SHORT NOTE (SOME LEGAL ISSUES SUMMARISED) I. NO TAX ON NOTIONAL INCOME: Income tax can be levied only on such income that is actually received. No tax on h…

M/S. K. Chimanlal & Co., (R.F.), Ahmedabad vs. The Jt.CIT, Range-2, Ahmedabad

In the result, the appeal of the assessee is dismissed

ITA 1281/AHD/2015[2011-12]Status: DisposedITAT Ahmedabad11 Oct 2017AY 2011-12
For Appellant: Shri S.N. Divetia, A.RFor Respondent: Prajna Madam, Sr. D.R
Section 143(2)Section 143(3)Section 234BSection 234DSection 250

…issioner of Income Tax 225 ITR 746 (SC) b) Commissioner of Income Tax v/s. A. Ramand & Co. 67 ITR 11 (SC) c) Commissioner of Income Tax v/s. Manharlal Girdharlal Doshit 231 ITR 89 (Gujarat) d) Highway Construction Co. Pvt. Ltd. v/s. Commissioner of Income Tax 199 ITR 702 (Gauhati) e) Kesarichand Jaysukhlal v/s. Commissioner of Income Tax 122 Taxman 307 (Gauhati) (4) Interest charged u/s.234B be deleted. (5) Interest charged u/s.234D be cancelled. (6) Appellant craves leave to add/ alter any grounds of appeal. Appellant therefore prays that addition sustained Rs.4,73,604/- out of Rs.7,30,285/- be deleted, assessme…

Manipur Tea Co. Private Limited, Kolkata vs. D.C.I.T., Circle-4, Kolkata

In the result, the appeal of the assessee is allowed

ITA 2692/KOL/2013[2008-2009]Status: DisposedITAT Kolkata26 Jul 2017AY 2008-2009

Bench: Sri J. Sudhakar Reddy & Sri S.S. Viswanethra Ravi] I.T.A. No. 2692/Kol/2013 Assessment Year: 2008-09

Section 14ASection 250

…that the assessee ought to have charged interest. 5 I.T.A. No. 2692/Kol/2013 Assessment Year: 2008-09 Manipur Tea Co. Private Ltd 17. The facts in the instant case are more or less identical with the case of Highways Construction Co. Pvt. Ltd. v CIT [1993] 199 ITR 702, wherein this court held (page 708) : "There is no finding of fact to the effect that actually the loan had been granted to the managing director or any other person on interest, or that interest had actually been collected and the collection of the interest was not reflected in the accounts. The finding of the Income Tax Officer is that the asse…

Streamline Shipping Co. P. Ltd, Mumbai vs. DCIT 3(3), Mumbai

In the result, the appeal is partly allowed

ITA 855/MUM/2012[2007-08]Status: DisposedITAT Mumbai28 Apr 2017AY 2007-08

Bench: Shri Joginder Singh () & Shri N.K. Pradhan () Assessment Year: 2007-08

For Appellant: Shri M. Subramanian, ARFor Respondent: Shri Vishwas Mundhe, DR
Section 10(34)Section 143(3)Section 14ASection 271

…t the disallowance of interest is justified when the amount borrowed had not been used for the purpose of business but for advancing money to Managing Director without interest. We may refer to the decision in Highways Construction Co. Pvt. Ltd. vs. CIT (Gau) 199 ITR 702, CIT vs. India Silk House (Mad) 152 ITR 79, Marolia & Sons vs. CIT (All) 129 ITR 475, Tirupati Trading Co vs. CIT (CL) 242 ITR 13, CIT vs. Sujanni Textiles (P) Ltd. (Mad) 225 ITR 560, CIT vs. H.R. Sugar Factory (P) Ltd. (All) 187 ITR 363, CIT vs. P. Ganu Rao and Sons (Mad) 185 ITR 324. The contention of the assessee that the total rate of interes…

ACIT, New Delhi vs. M/S. New Line Developers Pvt. Ltd., New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 733/DEL/2014[2009-10]Status: DisposedITAT Delhi20 Mar 2017AY 2009-10

Bench: Shri J. Sudhakar Reddy & Smt Suchitra Kamble

Section 143(2)Section 482

…addition was deleted by the CIT(A). By deleting it the CIT(A) also relied on the judgment of Hon'ble Supreme Court in case of CIT Vs. Shoorji Vallabhdas & Co. 46 ITR 144, judgment of Hon’ble Gowahati High Court in Straightways Construction Co Pvt. Ltd Vs. CIT 199 ITR 702 & Hon’ble Madras High Court in CIT Vs. Ramaswamy Naidu 35 ITR 33. 5. The Ld. DR submitted that the agreement clearly provides refund of the deposits made by the assessee within the 30 days of accrued period which ended as per the agreement on 30/9/2007. The assessee has deliberately tried not to recover its dues or charge any interest from the DT…

DCIT 5(1)(2), Mumbai vs. Ethl Global Capital Ltd, Mumbai

ITA 185/MUM/2015[2008-09]Status: DisposedITAT Mumbai06 Jan 2017AY 2008-09

Bench: S/Sh.Rajendra & C. N. Prasadआयकर अपील सं./I.T.A./185/Mum/2015,िनधा"रण वष" /Assessment Year:2008-09 Dcit,5(1)(2), M/S. Ethl Global Capital Ltd. Room No.568, 5Th Floor 19, Bhulabhai Desai Road, Mahalaxmi Vs. Aayakar Bhavan, M.K. Road Mumbai-400028 Mumbai-400 020 Pan:Aabce 4907 A (अपीलाथ" /Assessee) (""यथ" / Respondent) राज"व क" ओर से / Revenue By: Shri P.R. Ghosh-Dr अपीलाथ" क" ओर से /Assessee By: S/Shri Vijay Mehta & Anuj Kisnadwala सुनवाई क" तारीख / Date Of Hearing: 16/11/2016 घोषणा क" तारीख / Date Of Pronouncement:06.01.2017 लेखा सद", राजे" के अनुसार/ Per Rajendra A.M.- Challenging The Orders Dated 21.10.2014 Of The Cit(A)- 9,Mumbai,The Assessing Officer(Ao) Has Filed Present Appeal.Assessee-Company,Engaged In The Business Of Holding Investment In Shares & Debentures Of Companies,Filed Its Return Of Income On 23.09.2008,Disclosing Total Income At Rs.Nil. Original Assessment In This Case Was Completed U/S 143(3) Of. Act On 29.10.2010. Thereafter The Case Was Reopened U/S 147 Of I.T. Act & Reassessment Was Completed U/S 143(3) R.W.S.147 Of The Act On 28/03/2013 ,Determining Its Total Income At Rs.4,26,49,193/-.

For Appellant: S/Shri Vijay Mehta & Anuj KisnadwalaFor Respondent: Shri P.R. Ghosh-DR
Section 133(3)Section 14Section 143(3)Section 147

…e AO on account of notional interest was not sustainable. 4.Before us,the Departmental Represnetative(DR)supported the order of the AO.The Authorised Representative(AR)supported the order of the FAA and relied upon the cases of Highway Construction Co.P.Ltd.(199 ITR 702),B and A plantations and Industries Ltd.( 242 ITR 22). 5.We have heard the rival submissions and perused the material before us.We find that the assessee had advanced loan from its interest free funds and had not charged any interest,that the AO had taxed notional interest in the hands of the assessee without bringing any evidence of charging of…

M/S. Sri Endrash Investment & Finance (P) Ltd., New Delhi vs. ITO, New Delhi

In the result, appeal of the assessee is allowed

ITA 6956/DEL/2014[2010-11]Status: DisposedITAT Delhi27 Dec 2016AY 2010-11
For Appellant: Sh. Suresh Kumar Gupta, CAFor Respondent: Sh. F. R. Meena, Sr. DR
Section 143(1)

…d in the accounts, the only finding recorded was that the assessee ought to have charged interest. The Hon’ble High Court also made a reference to the decision of the Hon’ble Guwahati High Court in the case of Highways Construction Co. Pvt. Ltd. Vs CIT (1993) 199 ITR 702 wherein it has been held as under: "There is no finding of fact to the effect that actually the loan had been granted to the managing director or any other person on interest, or that interest had actually been collected and the collection of the interest was not reflected in the accounts. The finding of the Income Tax Officer is that the assesse…

DCIT Cen Cir 13, Mumbai vs. Parinee Realty P. Ltd, Mumbai

In the result, both the appeals of the Revenue and Cross Objections are dismissed

ITA 6215/MUM/2014[2010-11]Status: DisposedITAT Mumbai09 Nov 2016AY 2010-11

Bench: Shri R.C.Sharma, Am & Shri Pawan Singh, Jm

Section 143(3)

…ome on the basis that the income should have been earned by the appellant. The appellant is not obliged to charge interest at a particular rate and no addition can be made on the basis that such interest was not charged. This is well settled. For instance, in 199 ITR 702 (Gau) in the case of Highways Construction Co P Ltd, the High Court held that how can income tax department fix the interest that must be charged as due. Further, I also find that the AO has made a very hurried computation on rate of interest by merely taking the closing balance of the financial year instead of computing the interest rate based o…