Madras Industrial Investment Corporation Ltd. v. CIT

225 ITR 802Supreme Court of India1997#111 most cited

What is Madras Industrial Investment Corporation Ltd. v. CIT authority for?

Expenditure that provides an enduring benefit should be amortized over its useful life, not allowed as a deduction in a single year, to prevent a distorted picture of profits. Specifically, premium paid on debentures for their issue should be amortized on a straight-line method over the life of the debentures.

568

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2008 to 2026.

Also referred to as

Madras Industrial Investment Corporation Ltd. v. CIT · 225 ITR 802 · SC · enduring benefit · amortisation · section 37(1) · revenue expenditure · capital expenditure · premium on debentures · straight line method · matching principle

Sections most often in play

Section 143(3)Section 37(1)Section 153ASection 147Section 153CSection 132Section 14ASection 263
Read the full judgment

Issues it is cited on

enduring benefitsection 32(1)revenue expenditureintangible assetssection 32capital expendituresection 35commercial expediencysection 30book profitsamalgamationmercantile system of accounting

Judgments citing Madras Industrial Investment Corporation Ltd. v. CIT

DCIT (CC)-8(3), Mumbai vs. 63 Moons Technologies Ltd Q, Mumbai

Accordingly, claim of deduction was not allowed

ITA 3175/MUM/2024[2008-09]Status: DisposedITAT Mumbai11 Dec 2024AY 2008-09

Bench: Shri Saktijit Dey, Hon’Ble & Shri Amarjit Singh, Hon’Bleita No. 3175/Mum/2024 (A.Y. 2008-09) Dcit (Cc)-8(3), Mumbai 63 Moons Technologies Limited Cts No. 256-257, F.T. Tower, Vs Suren Road, Chakala, Andheri, Mumbai-400093. Pan: Aaacf 5737 C (Appellant) (Respondent)

For Appellant: Shri Sukhsagar SyalFor Respondent: Smt. Sanyogita Nagpal, CIT/DR
Section 132Section 14ASection 153ASection 40

…IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH ‘D’, MUMBAI BEFORE SHRI SAKTIJIT DEY, HON’BLE VICE PRESIDENT AND SHRI AMARJIT SINGH, HON’BLE ACCOUNTANT MEMBER ITA No. 3175/Mum/2024 (A.Y. 2008-09) DCIT (CC)-8(3), Mumbai 63 Moons Technologies Limited CTS No. 256-257, F.T. Tower, vs Suren Road, Chakala, Andheri, Mumbai-400093. PAN: AAACF 5737 C (Appellant) (Respondent) Present for: Assessee by : Shri Sukhsagar Syal Revenue by : Smt. Sanyogita Nagpal, CIT/DR Date of Hearing : 21.11.2024 Date of Pronouncement : 11.12.2024 O R D E R PER AMARJIT SINGH, AM: Both these appeals filed by the Revenue pertaining to A…

Allcargo Gati Limited(Formally Known As Gati Limited), Hyderabad vs. ITO, Ward-2(2), Hyd, Hyderabad

In the result, the appeal of assessee in ITA

ITA 190/HYD/2016[2010-11]Status: DisposedITAT Hyderabad10 Dec 2024AY 2010-11

Bench: Shri Laliet Kumar & Shri Madhusudan Sawdia

For Appellant: Shri Madhur Agarwal, AdvocateFor Respondent: Ms. K. Haritha, CIT-DR
Section 36(1)(iii)Section 37Section 37(1)

…High Court has held as under : “3.1 In our view, the Tribunal correctly accepted assessee s version; particularly in view of the decision of the Apex Court in case of Madras Industrial Investment Corporation Limited v. Commissioner of Income Tax, reported in 225 ITR 802. Learned counsel for the assessee brought to our notice a decision of this Court dated 1st February 1998 rendered in Income-Tax Application No. 259 of 1998 in case of Commissioner of Income Tax, Gujarat vs. Anil Starch Products Limited, wherein, it is observed as under :- 4. The question arose for consideration before their Lordship in Supreme Co…

Allcargo Gati Limited(Formally Known As Gati Limited), Hyderabad vs. ACIT, Circle-2(2) Hyderabad, Hyderabad

In the result, the appeal of assessee in ITA

ITA 1721/HYD/2016[2012-13]Status: DisposedITAT Hyderabad10 Dec 2024AY 2012-13

Bench: Shri Laliet Kumar & Shri Madhusudan Sawdia

For Appellant: Shri Madhur Agarwal, AdvocateFor Respondent: Ms. K. Haritha, CIT-DR
Section 36(1)(iii)Section 37Section 37(1)

…High Court has held as under : “3.1 In our view, the Tribunal correctly accepted assessee s version; particularly in view of the decision of the Apex Court in case of Madras Industrial Investment Corporation Limited v. Commissioner of Income Tax, reported in 225 ITR 802. Learned counsel for the assessee brought to our notice a decision of this Court dated 1st February 1998 rendered in Income-Tax Application No. 259 of 1998 in case of Commissioner of Income Tax, Gujarat vs. Anil Starch Products Limited, wherein, it is observed as under :- 4. The question arose for consideration before their Lordship in Supreme Co…

Indus Towers Limited (Formerly Known As Bharti Infratel Ltd and As Successor in Interest of Erstwhile Indus Tower Ltd), Gurugram, Haryana vs. DCIT, Circle 12(1), New Delhi

In the result, the appeal of the revenue is dismissed

ITA 2762/DEL/2023[2010-11]Status: DisposedITAT Delhi10 Dec 2024AY 2010-11

Bench: Shri M. Balaganesh & Shri Vimal Kumarindus Towers Ltd (Formerly Vs. Dcit, Known As Bharti Infratel Ltd), Circle-12(1), 4Th Floor, Dlf Cybercity, New Delhi Building No. 10, Tower A, Dlf Qe, So Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Acit, Vs. Indus Towers Ltd, 4Th Floor, Dlf Cybercity, Central Circle-10, New Delhi Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Indus Towers Ltd (Formerly Vs. Dcit, Known As Bharti Infratel Ltd), Circle-12(1), 4Th Floor, Dlf Cybercity, New Delhi Building No. 10, Tower A, Dlf Qe, So Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Assessee By : Shri Ajay Vohra, Sr. Adv Shri Rohit Jain, Adv Shri Deepesh Jain, Adv Ms. Shaurya Jain, Ca Revenue By: Shri Mukesh Kumar Jain, Cit Dr Date Of Hearing 12/09/2024 Date Of Pronouncement 10/12/2024

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri Mukesh Kumar Jain, CIT DR
Section 115JSection 139(5)Section 142Section 143(3)Section 148

…rom the cost of fixed assets and therefore does not claim any tax depreciation thereon. Following the mercantile system of accounting and the law enunciated by the Hon'ble Supreme Court in the case of Madras Industrial Investment Corporation Ltd v. CIT [1997] 225 ITR 802 (SC) and Rotork Controls India (P.) Ltd. vs. CIT [2009] 314 ITR 62 (SC), such SRO is amortized over the tenure of the lease and claimed as business expenditure deductible. During the relevant assessment year, the assessee amortized Rs.101,11,00,000 in the books of accounts in respect of site restoration obligation. For the purposes of MAT, since…

ACIT, Circle 10, New Delhi vs. Indus Tower Limited, Gurgaon

In the result, the appeal of the revenue is dismissed

ITA 2212/DEL/2023[2010-11]Status: DisposedITAT Delhi10 Dec 2024AY 2010-11

Bench: Shri M. Balaganesh & Shri Vimal Kumarindus Towers Ltd (Formerly Vs. Dcit, Known As Bharti Infratel Ltd), Circle-12(1), 4Th Floor, Dlf Cybercity, New Delhi Building No. 10, Tower A, Dlf Qe, So Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Acit, Vs. Indus Towers Ltd, 4Th Floor, Dlf Cybercity, Central Circle-10, New Delhi Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Indus Towers Ltd (Formerly Vs. Dcit, Known As Bharti Infratel Ltd), Circle-12(1), 4Th Floor, Dlf Cybercity, New Delhi Building No. 10, Tower A, Dlf Qe, So Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Assessee By : Shri Ajay Vohra, Sr. Adv Shri Rohit Jain, Adv Shri Deepesh Jain, Adv Ms. Shaurya Jain, Ca Revenue By: Shri Mukesh Kumar Jain, Cit Dr Date Of Hearing 12/09/2024 Date Of Pronouncement 10/12/2024

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri Mukesh Kumar Jain, CIT DR
Section 115JSection 139(5)Section 142Section 143(3)Section 148

…rom the cost of fixed assets and therefore does not claim any tax depreciation thereon. Following the mercantile system of accounting and the law enunciated by the Hon'ble Supreme Court in the case of Madras Industrial Investment Corporation Ltd v. CIT [1997] 225 ITR 802 (SC) and Rotork Controls India (P.) Ltd. vs. CIT [2009] 314 ITR 62 (SC), such SRO is amortized over the tenure of the lease and claimed as business expenditure deductible. During the relevant assessment year, the assessee amortized Rs.101,11,00,000 in the books of accounts in respect of site restoration obligation. For the purposes of MAT, since…

Indus Towers Ltd., Gurgaon vs. DCIT Circle 12(1), New Delhi

In the result, the appeal of the revenue is dismissed

ITA 1962/DEL/2023[2010-11]Status: DisposedITAT Delhi10 Dec 2024AY 2010-11

Bench: Shri M. Balaganesh & Shri Vimal Kumarindus Towers Ltd (Formerly Vs. Dcit, Known As Bharti Infratel Ltd), Circle-12(1), 4Th Floor, Dlf Cybercity, New Delhi Building No. 10, Tower A, Dlf Qe, So Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Acit, Vs. Indus Towers Ltd, 4Th Floor, Dlf Cybercity, Central Circle-10, New Delhi Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Indus Towers Ltd (Formerly Vs. Dcit, Known As Bharti Infratel Ltd), Circle-12(1), 4Th Floor, Dlf Cybercity, New Delhi Building No. 10, Tower A, Dlf Qe, So Gurgaon, Haryana (Appellant) (Respondent) Pan: Aadcv0274F Assessee By : Shri Ajay Vohra, Sr. Adv Shri Rohit Jain, Adv Shri Deepesh Jain, Adv Ms. Shaurya Jain, Ca Revenue By: Shri Mukesh Kumar Jain, Cit Dr Date Of Hearing 12/09/2024 Date Of Pronouncement 10/12/2024

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri Mukesh Kumar Jain, CIT DR
Section 115JSection 139(5)Section 142Section 143(3)Section 148

…rom the cost of fixed assets and therefore does not claim any tax depreciation thereon. Following the mercantile system of accounting and the law enunciated by the Hon'ble Supreme Court in the case of Madras Industrial Investment Corporation Ltd v. CIT [1997] 225 ITR 802 (SC) and Rotork Controls India (P.) Ltd. vs. CIT [2009] 314 ITR 62 (SC), such SRO is amortized over the tenure of the lease and claimed as business expenditure deductible. During the relevant assessment year, the assessee amortized Rs.101,11,00,000 in the books of accounts in respect of site restoration obligation. For the purposes of MAT, since…

ACIT, Range-I, Lucknow vs. Ci Hospitality Worldwide Private Limited, Lucknow

In the result, the appeal filed by Revenue is allowed and Cross

ITA 449/LKW/2020[2017-18]Status: DisposedITAT Lucknow29 Oct 2024AY 2017-18

Bench: Shri Anadee Nath Misshra & Shri Subhash Malguria

Section 253(3)

…e. On proper consideration, in fact, the case of CIT vs. Bilhari Investment (P) Ltd. (supra) acts, in facts of the case before us, against the assessee. In this case, Hon'ble Supreme Court took notice of Madras Industrial Investment Corpn. Ltd. vs. CIT (1997) 4 SCC 666 wherein Hon'ble Supreme Court made the following observation: “'Ordinarily, revenue expenditure which is incurred wholly and exclusively for the purpose of business must be allowed in its entirety in the year in which it is incurred. It cannot be spread over a number of years even if the assessee has written it off in his books, over a period of y…

DCIT 2(2), Mumbai vs. State Bank of India, Mumbai

In the result appeal filed by the assessee for assessment year 2006 – 07 and 2007 – 08 is partly allowed

ITA 4952/MUM/2013[2006-07]Status: DisposedITAT Mumbai11 Oct 2024AY 2006-07

Bench: Shri Prashant Maharishi, Am & Ms Kavitha Rajagopal , Jm A.Y.2006-07 [ By Assessee] &

Section 14Section 143Section 36Section 41

…the decision of the honourable Bombay High Court in case of Taparia tools Ltd versus joint Commissioner of income tax (2003) 260 ITR 102 and the decision of the honourable Supreme Court in case of Madras Industrial Investment Corporation Ltd versus CIT (1997) 225 ITR 802. It was also contested that securities of the bank are in the nature of stock in trade and as held in the decision of the honourable Supreme Court in case of United Commercial Bank Versus Cit 240 ITR 355 that a bank is entitled for ` depreciation in valuation of closing stock. Several other judicial precedents were pressed into service. Thus, it…

State Bank of India, Mumbai vs. Addl CIT Cir 2(2), Mumbai

In the result appeal filed by the assessee for assessment

ITA 3868/MUM/2013[2006-07]Status: DisposedITAT Mumbai11 Oct 2024AY 2006-07

Bench: Shri Prashant Maharishi, Am & Ms Kavitha Rajagopal , Jm

Section 14Section 143Section 36Section 41

…ecision of the honourable Bombay High Court in case of Taparia tools Ltd versus joint Commissioner of income tax (2003) 260 ITR 102 and the decision of the honourable Supreme Court in case of Madras Industrial Investment Corporation Ltd versus CIT (1997) 225 ITR 802. It was also contested that securities of the bank are in the nature of stock in trade and as held in the decision of the honourable Supreme Court in case of United Commercial Bank Versus Cit 240 ITR 355 that a bank is entitled for Page | 67 depreciation in valuation of closing stock. Several other judicial precedents were pressed into serv…

DCIT, New Delhi vs. M/S. Mahatta Towers Pvt. Ltd., New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 1137/DEL/2017[2012-13]Status: DisposedITAT Delhi10 Oct 2024AY 2012-13

Bench: Shri Kul Bharat & Shri Brajesh Kumar Singh[Assessment Year : 2012-13] Dcit, Vs M/S. Mahatta Towers Pvt.Ltd., Circle-16(1), 614, Plot No.54, Mahatta Towers, New Delhi. B Block, Community Center, Janakpuri, New Delhi-110058. Pan-Aaacm2109F Appellant Respondent Appellant By Shri Koushlender Tiwari, Cit Dr Respondent By Shri Ved Jain, Adv. Date Of Hearing 13.08.2024 Date Of Pronouncement 10.10.2024

Section 14Section 142(1)Section 143(2)Section 14A

…earnings for a period. The matching concept, or matching principle, is not an alternative to accrual accounting, but rather a fundamental element of it. This argument is based on the judgment of the Apex Court in Madras Industrial Investment Corporation Ltd. (225 ITR 802) (SC) In that case, the Supreme Court had referred to this 'matching concept. It was held that ordinarily revenue expenditure incurred wholly or exclusively for the purpose of business, can be applied in the year in which it is incurred. However, the facts may justify spreading the expenditure and claiming it over a period of ensuing years, where…

The Dy. Commissioner of Income Tax, Circle-2(1)(1), Baroda vs. M/S. Sun Pharma Laboratories Ltd., Mumbai

In the result, the Department’s appeal is partly allowed

ITA 741/AHD/2019[2015-16]Status: DisposedITAT Ahmedabad09 Oct 2024AY 2015-16

Bench: Smt. Annapurna Gupta (Accountant Member), Shri T.R. Senthil Kumar (Judicial Member)

Section 115JSection 143(3)Section 14ASection 36(1)(va)Section 37(1)Section 80Section 80I

…al year 2003-2004. The CIT (Appeals) on discussing various cases held that the same cannot be considered to be having an enduring benefit. 4.2 The Tribunal on this very issue relied on the decision of the Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC), wherein the question arose, whereby the Supreme Court was I.T.A Nos.712 & 741 /Ahd/2019 A.Y. 2015-16 48 Sun Pharma Labs. Ltd. vs. DCIT deciding whether a particular expenditure was revenue expenditure incurred for the purpose of business or capital in nature. It held that such question needs to be determined on a consideratio…

Sun Pharma Laboratories Ltd., Mumbai vs. The Dy. Commissioner of Income Tax, Circle-2(1)(1), Baroda

In the result, the Department’s appeal is partly allowed

ITA 712/AHD/2019[2015-16]Status: DisposedITAT Ahmedabad09 Oct 2024AY 2015-16

Bench: Smt. Annapurna Gupta (Accountant Member), Shri T.R. Senthil Kumar (Judicial Member)

Section 115JSection 143(3)Section 14ASection 36(1)(va)Section 37(1)Section 80Section 80I

…al year 2003-2004. The CIT (Appeals) on discussing various cases held that the same cannot be considered to be having an enduring benefit. 4.2 The Tribunal on this very issue relied on the decision of the Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC), wherein the question arose, whereby the Supreme Court was I.T.A Nos.712 & 741 /Ahd/2019 A.Y. 2015-16 48 Sun Pharma Labs. Ltd. vs. DCIT deciding whether a particular expenditure was revenue expenditure incurred for the purpose of business or capital in nature. It held that such question needs to be determined on a consideratio…

Asst. Commissioner of Income Tax 8(2)(1), Mumbai, Ayakar Bhavan vs. Piramal Glass Private Limited, Mumbai

In the result, the appeal of the Revenue is dismissed

ITA 1232/MUM/2024[2021-22]Status: DisposedITAT Mumbai27 Sept 2024AY 2021-22

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan () Assessment Year: 2021-22 Asst. Cit-8(2)(1), Piramal Glass Pvt. Ltd., Room No. 481, Aayakar Bhavan, 6Th Floor, Piramal Tower Annexe Maharishi Karve Road, Vs. Ganpatrao Kadam Marg, Lower Mumbai-400020. Parel, Mumbai-400013. Pan No. Aabcg 0093 R Appellant Respondent

For Respondent: Mr. Ronak Doshi &
Section 36(1)(ii)

…y the per the ratio laid down by the Hon'ble Supreme Court in the case of Madras Industrial Investment Hon'ble Supreme Court in the case of Madras Industrial Investment Hon'ble Supreme Court in the case of Madras Industrial Investment Corporation Itd. v. CIT (225 ITR 802) (SC). The appellant further Corporation Itd. v. CIT (225 ITR 802) (SC). The appellant further Corporation Itd. v. CIT (225 ITR 802) (SC). The appellant further contended that the Hon'ble ITAT in the appellant's own case for A.Y. contended that the Hon'ble ITAT in the appellant's own case for A.Y. contended that the Hon'ble ITAT in the appellant'…

State Bank of India, Mumbai vs. Principle Commissioner of Income Tax-2, Mumbai

ITA 1533/MUM/2023[2019-20]Status: DisposedITAT Mumbai28 Aug 2024AY 2019-20

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri Ketan Ved &For Respondent: Shri Dr. Kishor Dhule, CIT DR
Section 143(3)Section 144BSection 263

…arned PCIT erred in not appreciating that the amortization of premium is in the nature of deferred revenue expenditure and is deductible in terms of the judgments of the Supreme Court in the case of Madras Industrial Investment Corporation Ltd. v. CIT [1997] (225 ITR 802). 8.5 The learned PCIT erred in not following the decision of the Delhi High Court in the case of CIT v/s. Vashist Chay Vyapar Ltd. [330 ITR 440] affirmed the Supreme Court in 301 CTR 263. 8.6 The learned PCIT erred in not accepting the Bank's argument that Instruction No. 17/2008 dated 26 November 2008 was applicable to the Bank's case. 8.7 T…

DCIT, New Delhi vs. M/S. Magnum Power Generation Ltd., New Delhi

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

ITA 2509/DEL/2017[2012-13]Status: DisposedITAT Delhi23 Aug 2024AY 2012-13

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), MS. MADHUMITA ROY (Judicial Member)

Section 143(2)

…arnings for a period. The matching concept, or matching principle, is not an alternative to accrual accounting, but rather a fundamental element of it. This argument is based on the judgment of the Apex Court in Madras Industrial Investment Corporation Ltd. (225 ITR 802) (SC) In that case, the Supreme Court had referred to this 'matching concept'. It was held that ordinarily revenue expenditure incurred wholly or exclusively for the purpose of business, can be applied in the year in which it is incurred. However, the facts may justify spreading the expenditure and claiming it over a period of ensuing years, wher…

JCIT(OSD) Corporate Circle-1(1), Chennai vs. M/S Cholamandalam Investment and Fiance Comppany Limited, Chennai

In the result, the appeals filed by the assessee in ITA

ITA 515/CHNY/2023[2018-19]Status: DisposedITAT Chennai14 Aug 2024AY 2018-19

Bench: Shri Mahavir Singhand Shri S.R. Raghunatha

For Appellant: Shri Ajit Jain, CA (Through Virtual)For Respondent: Shri Nilay Baran Som, CIT
Section 143(3)

…ment order and that of the order of CIT(A), wherein the AO came to the conclusion regarding disallowance of prepaid finance charges on the basis of decision of Hon’ble Supreme Court in the case of Madras Industrial Corporation Ltd., vs. CIT reported in (1997) 225 ITR 802 (SC). The ld.CIT-DR pointed out that during the last hearing in this case, the Tribunal directed the assessee to clarify that there is no overall loss to the Revenue so far as its claim for prepaid finance charges are concerned. He argued that while the details submitted by the assessee do reflect the basis of claim appearing in the P & L account…

JCIT(OSD) Corporate Circle-1(1), Chennai vs. M/S Cholamandalam Investment and Fiance Comppany Limited, Chennai

In the result, the appeals filed by the assessee in ITA

ITA 514/CHNY/2023[2017-18]Status: DisposedITAT Chennai14 Aug 2024AY 2017-18

Bench: Shri Mahavir Singhand Shri S.R. Raghunatha

For Appellant: Shri Ajit Jain, CA (Through Virtual)For Respondent: Shri Nilay Baran Som, CIT
Section 143(3)

…ment order and that of the order of CIT(A), wherein the AO came to the conclusion regarding disallowance of prepaid finance charges on the basis of decision of Hon’ble Supreme Court in the case of Madras Industrial Corporation Ltd., vs. CIT reported in (1997) 225 ITR 802 (SC). The ld.CIT-DR pointed out that during the last hearing in this case, the Tribunal directed the assessee to clarify that there is no overall loss to the Revenue so far as its claim for prepaid finance charges are concerned. He argued that while the details submitted by the assessee do reflect the basis of claim appearing in the P & L account…

Cholamandalam Investment &Finance Company Limited, Parrys, Chennai vs. ACIT- Corporate Circle -1(2), Chennai

In the result, the appeals filed by the assessee in ITA

ITA 384/CHNY/2023[AY 2017-2018]Status: DisposedITAT Chennai14 Aug 2024

Bench: Shri Mahavir Singhand Shri S.R. Raghunatha

For Appellant: Shri Ajit Jain, CA (Through Virtual)For Respondent: Shri Nilay Baran Som, CIT
Section 143(3)

…ment order and that of the order of CIT(A), wherein the AO came to the conclusion regarding disallowance of prepaid finance charges on the basis of decision of Hon’ble Supreme Court in the case of Madras Industrial Corporation Ltd., vs. CIT reported in (1997) 225 ITR 802 (SC). The ld.CIT-DR pointed out that during the last hearing in this case, the Tribunal directed the assessee to clarify that there is no overall loss to the Revenue so far as its claim for prepaid finance charges are concerned. He argued that while the details submitted by the assessee do reflect the basis of claim appearing in the P & L account…

M/S Cholamandalam Investment & Finance Company Limited, Chennai vs. DCIT-1(2), Chennai

In the result, the appeals filed by the assessee in ITA

ITA 847/CHNY/2020[2012-13]Status: DisposedITAT Chennai14 Aug 2024AY 2012-13

Bench: Shri Mahavir Singhand Shri S.R. Raghunatha

For Appellant: Shri Ajit Jain, CA (Through Virtual)For Respondent: Shri Nilay Baran Som, CIT
Section 143(3)

…ment order and that of the order of CIT(A), wherein the AO came to the conclusion regarding disallowance of prepaid finance charges on the basis of decision of Hon’ble Supreme Court in the case of Madras Industrial Corporation Ltd., vs. CIT reported in (1997) 225 ITR 802 (SC). The ld.CIT-DR pointed out that during the last hearing in this case, the Tribunal directed the assessee to clarify that there is no overall loss to the Revenue so far as its claim for prepaid finance charges are concerned. He argued that while the details submitted by the assessee do reflect the basis of claim appearing in the P & L account…

ITO, Cw-1(1), Chennai vs. Inspirisys Solutions Ltd, Kilpauk

The appeals of the Revenue stand dismissed

ITA 9/CHNY/2022[2012-13]Status: DisposedITAT Chennai26 Jul 2024AY 2012-13

Bench: Hon’Ble Shri Manoj Kumar Aggarwal, Am & Hon’Ble Shri Manu Kumar Giri, Jm आयकरअपील सं./ Ita Nos.9,10 & 11/Chny/2022 (िनधा"रणवष" / Assessment Years: 2012-13, 2014-15 & 2015-2016) & C.O.Nos.5, 6 &7/Chny/2023 (In Ita Nos.9,10 & 11/Chny/2022) The Income Tax Officer, Vs. M/S. Inspirisys Solutions Limited, Corporate Ward 1(1) First Floor, New Door Nos. 57,59,63 & 64, Chennai 600 034. Dowlath Towers, Taylors Road, Kilpauk, Chennai 600 010. [Pan: Aaaca 5622M] (अपीलाथ"/Appellant) (Respondent/ Cross Objector) Department By : Shri. Nilay Baran Som, Irs, Cit. Shri. Arv Srinivasan, Irs, Addl. Cit Assessee By : Shri. N.V. Balaji, Advocate सुनवाई क" तार"ख/Date Of Hearing : 20.06.2024 घोषणा क" तार"ख /Date Of Pronouncement : 26.07.2024

For Appellant: Shri. N.V. Balaji, AdvocateFor Respondent: Shri. Nilay Baran Som, IRS, CIT
Section 14ASection 253

…of the matching concept, in a year where there is no exempt income, there cannot be a disallowance of expenditure in relation to such assumed income. Madras Industrial Investment 20 ITA Nos.9-11/Chny/2022 & CO Nos. 5-7/Chny/2023 Corpn. Ltd. v. CIT [1997] 225 ITR 802/91 Taxman 340 (SC). The language of s.14A (1) should be read in that context and such that it advances the scheme of the Act rather than distort it. 16. In conclusion, we are of the view that the provisions of s. 14A read with Rule 8D of the Rules cannot be made applicable in a vacuum i.e. in the absence of exempt income. The questions of law are…