Madhav Prasad Jatia v. CIT

Commissioner of Income Tax Delhi IV vs. Dlf Universal Ltd

…t paid” which is governed by Section 36(1)(iii) of the Act. The ITAT noted the definition of interest in Section 2(28A). The impugned order took note of the Supreme Court judgment in Madhav 2015:DHC:3453-DB ITA 1136/2009 Page 3 Prasad Jatia V. CIT (118 ITR 200) to say that three conditions had to be satisfied to claim deduction in respect of interest on borrowed capital and that the expression „for the purpose of business‟ under Section 36(1)(iii) and Section 37 is wider than the expression “for the purpose of earning income, profits and gains” under Section 57(iii). Therefore, it was held that i…

Commissioner of Income Tax vs. Bharti Televenture Ltd

…which states that "the amount of the interest paid in respect of capital borrowed for the purposes of the business or profession" has to be allowed as a deduction in computing the income tax under Section 28 of the Act. In Madhav Prasad Jantia vs. CIT [1979] 118 ITR 200 (SC); AIR 1979 SC 1291, this Court held that expression "for the purpose of business" occurring under the provision is wider in scope than the expression "for the purpose of earning income. profits or gains", and this has been the consistent view of this Court. In our opinion, the High Court in the impugned judgment, as well as the Tribunal and t…

Commissioner of Income Tax vs. Bharti Televenture Ltd

…which states that "the amount of the interest paid in respect of capital borrowed for the purposes of the business or profession" has to be allowed as a deduction in computing the income tax under Section 28 of the Act. In Madhav Prasad Jantia vs. CIT [1979] 118 ITR 200 (SC); AIR 1979 SC 1291, this Court held that expression "for the purpose of business" occurring under the provision is wider in scope than the expression "for the purpose of earning income, profits or gains", and this has been the consistent view of this Court. In our opinion, the High Court in the impugned judgment, as well as the Tribunal and t…

The Commissioner of Income Tax vs. M/S Gautam Motors

Bench: The Commissioner Of Income Tax (Appeals) Which Was Partly Allowed. Not Fully Satisfied With The Decision Of The Cit(A), The Assessee Approached The Income Tax Appellate Tribunal. The Department Also Filed Cross-Appeal Against The Order Of The Cit(A) Challenging The Additions Which Were Deleted

…n that the original borrowing was utilized for other purposes and not for business purposes. The finding of the Tribunal in this behalf is purely an inference in law. It ignores the law laid down by the Supreme Court in Madhav Prasad Jatia v. CIT [1979] 118 ITR 200 and in the Bombay High Court case CIT v. Bombay Samachar Ltd. [1969] 74 ITR 723, that once the three conditions laid down there are satisfied, the deduction under section 36(1)(iii) must be given. Again, the contention that the correct amount of debit balance to the account of the partners should be taken as Rs.1,73,643 instead of Rs.1,93…

Punjab Stainless Steel Industries vs. Commissioner of Income Tax Delhi VII & Anr

Bench: HON'BLE MR. JUSTICE BADAR DURREZ AHMED,HON'BLE MR. JUSTICE V.K. JAIN

…as a prudent businessman incurs for the purpose of business, though it may not have been incurred under any legal obligation. Interpreting its earlier ITA No.47/2008 Page 7 of 18 decision in the case of Madhav Prasad Jatia v. CIT : (1979) 118 ITR 200 (SC), the Court was of the view that the ratio of its decision in that case was that the borrowed funds, advanced to a third party, should be for commercial expediency if it is sought to be allowed under Section 36(1)(iii) of the Income Tax Act. The Court agreed with the view taken by this Court in CIT v. Dalmia Cement (B.) Limited : (2002…