Khalsa Brothers v. CIT

217 ITR 185High Court1996#7747 most cited

What is Khalsa Brothers v. CIT authority for?

An activity can be considered 'production' for income-tax purposes if it leads to a new, identifiable product, even if the original materials are not entirely consumed. This principle, affirmed by several High Courts including Khalsa Brothers v. CIT, establishes a settled position of law regarding what constitutes 'production'.

14

judgments rely on this decision, according to BharatTax’s citation analysis of 366,315 Indian tax judgments — from 2015 to 2026.

Also referred to as

Khalsa Brothers v. CIT · production · business income · High Court decisions · settled position of law · 217 ITR 185 · Calcutta High Court · CIT v. Singareni Collieries Co. Ltd.

Sections most often in play

Section 80-IA(8)/(10)Section 80-ICSection 2(29BA)

Issues it is cited on

section 2(29ba)section 32asection 80icchildsection 80isection 32section 80section 15transfercompanyindianfac

Judgments citing Khalsa Brothers v. CIT

M/S. Alkraft Thermotechnologies Pvt. Ltd., Chennai vs. DCIT, CC-1(1), Chennai

In the result, the appeals of the assessee for AYs 2011-12, 2012-

ITA 1950/CHNY/2025[2018-19]Status: DisposedITAT Chennai18 Feb 2026AY 2018-19

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr.R. Vijayaraghavan, AdvFor Respondent: Ms.R. Anitha, Addl.CIT
Section 80

…hat the activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996] 221 ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and ITA Nos.1946-1950/Chny/2025 (AYs 2011-12 to 2013-14, 2017-18 & 2018-19) M/s. Alkraft Thermotechnologies Pvt. Ltd. :: 17 :: CIT v. Mercantile Construction Co. [1994] 74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the…

M/S. Alkraft Thermotechnologies Pvt. Ltd., Chennai vs. DCIT, CC-1(1), Chennai

In the result, the appeals of the assessee for AYs 2011-12, 2012-

ITA 1948/CHNY/2025[2013-14]Status: DisposedITAT Chennai18 Feb 2026AY 2013-14

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr.R. Vijayaraghavan, AdvFor Respondent: Ms.R. Anitha, Addl.CIT
Section 80

…hat the activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996] 221 ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and ITA Nos.1946-1950/Chny/2025 (AYs 2011-12 to 2013-14, 2017-18 & 2018-19) M/s. Alkraft Thermotechnologies Pvt. Ltd. :: 17 :: CIT v. Mercantile Construction Co. [1994] 74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the…

M/S.Alkraft Thermotechnologies Pvt. Ltd., Chennai vs. DCIT, CC-1(1), Chennai

In the result, the appeals of the assessee for AYs 2011-12, 2012-

ITA 1947/CHNY/2025[2012-13]Status: DisposedITAT Chennai18 Feb 2026AY 2012-13

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr.R. Vijayaraghavan, AdvFor Respondent: Ms.R. Anitha, Addl.CIT
Section 80

…hat the activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996] 221 ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and ITA Nos.1946-1950/Chny/2025 (AYs 2011-12 to 2013-14, 2017-18 & 2018-19) M/s. Alkraft Thermotechnologies Pvt. Ltd. :: 17 :: CIT v. Mercantile Construction Co. [1994] 74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the…

M/S. Alkraft Thermotechnologies Pvt. Ltd., Chennai vs. DCIT, CC-1(1), Chennai

In the result, the appeals of the assessee for AYs 2011-12, 2012-

ITA 1946/CHNY/2025[2011-12]Status: DisposedITAT Chennai18 Feb 2026AY 2011-12

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr.R. Vijayaraghavan, AdvFor Respondent: Ms.R. Anitha, Addl.CIT
Section 80

…hat the activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996] 221 ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and ITA Nos.1946-1950/Chny/2025 (AYs 2011-12 to 2013-14, 2017-18 & 2018-19) M/s. Alkraft Thermotechnologies Pvt. Ltd. :: 17 :: CIT v. Mercantile Construction Co. [1994] 74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the…

DCIT, Circle-10(1), Kolkata vs. M/S Indian Oil Petronas (P) Ltd., Kolkata

In the result, the Cross Objections of the assessee are allowed for statistical purposes

ITA 1885/KOL/2019[2014-15]Status: DisposedITAT Kolkata30 Apr 2021AY 2014-15

Bench: Sri J. Sudhakar Reddy & Sri Aby T. Varkey)

Section 250Section 32(1)(iiia)Section 80

…that the activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996J 221ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and CIT v. Mercantile Construction Co. [1994] 74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin .) Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the position of law. therefore, was taken as settled. The reasoning given by the High Court, in the decisions noted by us ear…

D.C.I.T., Circle-10(1), Kolkata vs. M/S Indian Oil Petronas Pvt. Ltd., Kolkata

In the result, the Cross Objections of the assessee are allowed for statistical purposes

ITA 1884/KOL/2019[2013-14]Status: DisposedITAT Kolkata30 Apr 2021AY 2013-14

Bench: Sri J. Sudhakar Reddy & Sri Aby T. Varkey)

Section 250Section 32(1)(iiia)Section 80

…that the activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996J 221ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and CIT v. Mercantile Construction Co. [1994] 74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin .) Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the position of law. therefore, was taken as settled. The reasoning given by the High Court, in the decisions noted by us ear…

Vedanta Ltd, Gurgaon vs. ACIT, Circle- 26(2), New Delhi

ITA 12/DEL/2020[2014-15]Status: FixedITAT Delhi18 Sept 2020AY 2014-15

Bench: Shri N.K. Billaiya & Shri Kuldip Singh[Assessment Year: 2014-15]

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri Anupam Kant Garg, CIT-DR
Section 143(3)Section 153

…he activity amounted to "production" and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. (1996) 221 ITR 48 (AP), the Calcutta High Court in Khalsa Brothers v. CIT (1996) 217 ITR 185 (Cal) and CIT v. Mercantile Construction Co. (1994) 74 Taxman 41 (Cal) and the Delhi High Court in CIT v. Univmine (P) Ltd. (1993) 202 ITR 825 (Del). The revenue has not questioned any of these decisions, at least not successfully, and the position of law, therefore, was taken as settled. 6. At the outset, it may be noted that section 32A(2)(b)(…

DCIT, Circle - 6(1), Kolkata vs. M/S. Integrated Coal Mining Limited, Kolkata

Appeal is partly allowed in above terms

ITA 170/KOL/2018[2010-11]Status: DisposedITAT Kolkata15 Mar 2019AY 2010-11

Bench: Shri S.S.Godara & Dr. A.L. Sainiassessment Year :2010-11 Dcit, Circle-6(1), V/S. M/S Integrated Coal P-7, Chowringhee Mining Ltd., 6, Church Square, Kolkata-69 Lane, 1Ste Floor, Kolakta-700001 [Pan No.Aaaci 5584 L] .. अपीलाथ" /Appellant ""यथ"/Respondent Dr. P.K. Srihari, Cit-Dr अपीलाथ" क" ओर से/By Appellant Shri Diparun Mukherjee, Aca & ""यथ" क" ओर से/By Respondent Shri Alolk Goenka, Aca 15-01-2019 सुनवाई क" तार"ख/Date Of Hearing 15-03-2019 घोषणा क" तार"ख/Date Of Pronouncement

Section 139(1)Section 143(3)Section 43B

…doubt production. At paragraph 12 of the juddgmente it hsaid that after wining coal something that was not there comes up, and it is, therefore, a production of coal. The Division Bench followed its own decision in the later case of Khalsa Bros v. CIT [1996] 217 ITR 185. Mr. Bajoria also relied on the interesting case of CIT vs. Shan Finance (P) Ltd. [1998] 231 ITR 308 where the Supreme Court opined that a financier owning machinery might still be entitled to investment allowance even if the machinery is actually used by its lessee for the purpose of production. Going on the language of sub-sections (1) and (2)…

DCIT, Circle-10(1), Kolkata vs. M/S Indian Oil Petronas (P) Ltd., Kolkata

In the result, the appeal of the revenue is dismissed

ITA 1930/KOL/2016[2010-11]Status: DisposedITAT Kolkata15 Mar 2019AY 2010-11

Bench: Shri A.T. Varkey, Jm & Dr.A.L.Saini, Am D.C.I.T, Cir­10(1), Kolkata Vs. M/S. Indian Oil Petronas Pvt. Ltd. Pan: Aaaci5573R (अपीलाथ" /Assessee) (""यथ" / Respondent) .. Assessee/Revenue By : Shri P.K. Srihari, Cit, Ld. Dr Respondent/Assessee By : Shrid. S Damle, Fca, Ld.Ar सुनवाईक"तार"ख/ Date Of Hearing : 18/12/2018 घोषणाक"तार"ख/Date Of Pronouncement : 15/03/2019 आदेश / O R D E R

For Appellant: ShriD. S Damle, FCA, ld.ARFor Respondent: Shri P.K. Srihari, CIT, ld. DR
Section 143(3)Section 194ISection 2Section 37(1)Section 40

…P.Ltd activity amounted to 'production' and answered the issue in question in favour of the assessee. The High Court of Andhra Pradesh did so in CIT v. Singareni Collieries Co. Ltd. [1996J 221 ITR 48, the Calcutta High Court in Khalsa Brothers v. CIT [1996] 217 ITR 185 and CIT v. Mercantile Construction Co. [1994]74 Taxman 41 (Cal.) and the Delhi High Court in CIT v. Univmin .) Ltd. [1993] 202 ITR 825. The Revenue has not questioned any of these decisions, at least not successfully, and the position of law. therefore, was taken as settled. The reasoning given by the High Court, in the decisions noted by us earl…

M/S. Bla Industries Pvt. Ltd., Mumbai vs. PCIT-1, Kolkata

In the result, assessee’s appeal stands allowed

ITA 779/KOL/2016[2011-2012]Status: DisposedITAT Kolkata28 Feb 2018AY 2011-2012

Bench: Shri N.V.Vasudevan & Shri Waseem Ahmedassessment Year :2011-12 Bla Industries Pvt.Ltd. V/S. Pr. Cit-1, 84, Maker Chambers Iii, Aayakar Bhawan, Nariman Point, Mumbai- Kolkata 400021 [Pan No.Aabcb 3505 D] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Robin Maheshwari, Aca अपीलाथ" क" ओर से/By Appellant Shri A.K. Tiwari, Cit-Dt ""यथ" क" ओर से/By Respondent 08-02-2018 सुनवाई क" तार"ख/Date Of Hearing 28-02--2018 घोषणा क" तार"ख/Date Of Pronouncement आदेश /O R D E R Per Waseem Ahmed:- This Is An Appeal Filed By The Assessee Against Order Of Ld. Pr. Commissioner Of Income Tax-1, Kolkata Passed U/S 263 Of The Income Tax Act, 1961 (Hereinafter Referred To As ‘The Act’) In M.No.Pr. Cit-1/15- 16/U/S263/Bla Industries/2011-12/12629-31 Dated 23/28.03.2016 For Assessment Year 2011-12. Shri Robin Maheshwari, Ld. Authorized Representative Appeared On Behalf Of The Assessee & Shri A.K. Tiwari, Ld. Departmental Representative Appeared On Behalf Of The Revenue. 2. In This Assessee’S Appeal The Assessee Has Raised The Following Grounds:- “1) For That The Order Of The Ld. Cit Passed U/S. 263 Is Bad In Law As Well As In Facts Hence Liable To Be Quashed.

Section 143(2)Section 143(3)Section 14ASection 263Section 32Section 32(1)(iia)

…the plant and machinery used in the business of manufacture / production of article or thing. The assessee in support its claim has relied on the following judgments:- a) CIT vs. G.S. Atwl & Co.(Gua) (2002) 254 ITR 592 (Cal) b) Khalsa Brothers vs. CIT (1996) 217 ITR 185 (Cal) c) CIT vs. Singareni Collieries Co. Ltd. (11996) 221 ITR 48W(AP) d) CIT vs. Sesa Goa Ltd. (2004) 271 ITR 331 (SC) However, Ld. Pr.CIT was of the view that no necessary enquiry has been conducted by the AO during the course of assessment proceeding, which rendered the order of AO as erroneous in so far a prejudicial to the interest of revenu…

M/S. Ujjal Transport Agency, Asansol vs. D.C.I.T., Central Circle-Xvi, Kolkata

In the result, assessee's CO is partly allowed”

ITA 1601/KOL/2014[2007-2008]Status: DisposedITAT Kolkata14 Jul 2017AY 2007-2008

Bench: Hon’Ble Shri A.T.Varkey, Jm & Shri M.Balaganesh, Am ] I.T.A No. 1601/Kol/2014 Assessment Year : 2007-08 M/S Ujjal Transport Agency, -Vs- Dcit, Central, Circle-Xvi, Kolkata G.T.Road(East), Murgasole Asansol Pan : Aaafu 6732 H] (Respondent) (Appellant) For The Appellant : A. K. Tibrewal, Fca Amit Agarwal, Adv. For The Respondent : None Date Of Hearing : 11.07.2017 Date Of Pronouncement : 14.07.2014 Order

For Appellant: A. K. Tibrewal, FCAFor Respondent: None
Section 143(1)Section 147Section 148Section 153ASection 263Section 32(1)(iia)

…o doubt production. At paragraph 12 of the judgment it said that after winning coal something that was not there comes up. and it is, therefore, a production of coal. The Division Bench followed its own decision in the later case of Khalsa Bros. v. CIT [1996] 217 ITR 185. Mr. Bajoria also relied on the interesting case of CIT v. Shaan Finance (P.) Ltd. [1998] 231 ITR 3081 where the Supreme Court 6 7 Ujjal Transport Agency A.Yr.07-08 opined that a financier owning machinery might still be entitled to investment allowance even if the machinery is actually used by its lessee for the purpose of production. Going on…

JCIT (OSD), CC-Xx, Kolkata vs. M/S G. S. Atwal & Co.(Engg) Pvt. Ltd., Kolkata

In the result, assessee’s CO is partly allowed

ITA 1516/KOL/2012[2009-10]Status: DisposedITAT Kolkata26 Apr 2017AY 2009-10

Bench: Shri Waseem Ahmed & Shri S.S.Viswanethra Raviassessment Year:2009-10

Section 143(1)Section 143(2)Section 143(3)Section 145A

…not doubt production. At paragraph 12 of the judgment it said that after winning coal something that was not thee comes up, and it is, therefore, a production of coal. The Division Bench allowed its own decision in the later case of Khalsa Bros vs. CIT [1996] 217 ITR 185. MR. Bajoria also relied on the interesting case of CIT v. Shann finance (P) Ltd [1998] ITA No. 1146, 1138/Kol/2012-C-AM Integrated Coal Mining Ltd 23 231 ITR 308 where the Supreme Court opined that a financier owning machinery might still be entitled to investment allowance even if the machinery is actually used by its lessee for the purpose of…

D.C.I.T Cir - 6, Kolkata vs. M/S Integrated Coal Mining Ltd, Kolkata

In the result, the appeal of the Assessee in ITA No

ITA 1758/KOL/2013[2009-10]Status: DisposedITAT Kolkata16 Sept 2016AY 2009-10

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

Section 14ASection 43B

…no doubt production. At paragraph 12 of the judgment it said that after winning coal something that was not there comes up, and it is, therefore, a production of coal. The Division Bench followed its own decision in the later case of Khalsa Bros v. CIT [1996] 217 ITR 185. Mr. Bajoria also relied on the interesting case of CIT v. Shann Finance (P) Ltd [1998] 231 ITR 308 where the Supreme Court opined that a financier owning machinery might still be entitled to investment allowance even if the machinery is actually used by its lessee for the purpose of production. Going on the language of sub-sections (1) and (2) o…

DCIT, Circle-6, Kolkata vs. M/S. Integrated Coal Mining Ltd, Kolkata

In the result, the appeal of the revenue is dismissed

ITA 1138/KOL/2012[2008-2009]Status: DisposedITAT Kolkata13 Nov 2015AY 2008-2009

Bench: : Shri M. Balaganesh

For Appellant: Shri J.P Khaitan, ld.ARFor Respondent: Shri G.Mallikarjuna, CIT, ld.DR
Section 143(3)Section 14A

…no doubt production. At paragraph 12 of the judgment it said that after winning coal something that was not there comes up, and it is, therefore, a production of coal. The Division Bench followed its own decision in the later case of Khalsa Bros v. CIT [1996] 217 ITR 185. Mr. Bajoria also relied on the interesting case of CIT v. Shann Finance (P) Ltd [1998] ITA Nos..1146, 1138/Kol/2012-C-AM 23 231 ITR 308 where the Supreme Court opined that a financier owning machinery might still be entitled to investment allowance even if the machinery is actually used by its lessee for the purpose of production. Going on the…

Khalsa Brothers v. CIT (217 ITR 185) — Cited in 14 Judgments | BharatTax