McDowell & Co. Ltd. v. CTO

154 ITR 148Supreme Court of India1985#68 most cited

What is McDowell & Co. Ltd. v. CTO authority for?

The Supreme Court held that while legitimate tax planning is permissible, transactions structured as a "colourable device" or "subterfuge" solely to avoid tax are impermissible. It mandates a judicial shift to look beyond the form to the substance of a transaction, allowing the lifting of the corporate veil in tax evasion arrangements.

741

judgments rely on this decision, according to BharatTax’s citation analysis of 367,181 Indian tax judgments — from 2008 to 2026.

Also referred to as

McDowell & Co. Ltd. v. CTO · 154 ITR 148 · tax avoidance vs. tax planning · colourable device · substance over form · lifting corporate veil · tax evasion · accommodation entry · genuineness of transaction · sections 143(3) · 147 · 68 · 69C

Also reported as

22 Taxmann 113 SCC 2301 SCR 914

Sections most often in play

Section 143(3)Section 148Section 147Section 68Section 69CSection 133ASection 132(4)Section 143(2)

Issues it is cited on

colourable deviceazadi bachao andolanlive linkentry operatorpenny stocksection 10(38)genuineness of the transactionlong term capital gainsaddition u/s 68share application moneyaccommodation entrysection 131

Judgments citing McDowell & Co. Ltd. v. CTO

Jivanlal Corporation, Mumbai vs. ITO -17(2)(1), Mumbai

In the result, assessee’s appeal is partly allowed

ITA 857/MUM/2020[2010-11]Status: DisposedITAT Mumbai09 Nov 2021AY 2010-11
Section 131Section 145(3)Section 154Section 234ASection 271Section 271(1)

…the aforesaid parties are Hawala Operators after conducting independent enquiries. • The purchases from hawala operator falls within the ambit of the term 'colourable devices' and the Hon'ble Supreme Court observed in the case of McDowell and Co. Ltd. Vs. CTO 154 ITR 148 that “Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious method. It is obligation of every citizen to pay the taxes honestly without resorting to s…

Soumy Associates, Mumbai vs. Income Tax Officer 29(3)(3), Mumbai

In the result, the appeal stands allowed

ITA 5469/MUM/2019[2009-10]Status: DisposedITAT Mumbai03 Nov 2021AY 2009-10
Section 133ASection 143(2)Section 147Section 148

…cumstances of the case indicates that the method of client code modification adopted by the assessee is a colourable device to reduce tax burden, which is not permissible as per the decision of Hon'ble Supreme Court in the case of Me Dowell and Co. Ltd (1985)(154 ITR 148). In view of the above referred facts and circumstances of the case and in law, assessee's loss of Rs. 2,75,250/- attributed to client code modification transaction is treated as fictitious and non genuine. This loss is ignored and assessee's income as per Profit & Loss a/c is enhanced by ignoring artificial and non genuine loss of Rs.2,75,250/-.…

D.C.I.T. Cir. 7(1), Mumbai vs. M/S. Peninsula Land Ltd., Mumbai

Appeal stand partly allowed

ITA 3696/MUM/2009[2005-06]Status: DisposedITAT Mumbai27 Oct 2021AY 2005-06

Bench: Hon’Ble Shri Mahavir Singh, Vp & Hon’Ble Shri Manoj Kumar Aggarwal, Am (Hearing Through Video Conferencing Mode) आयकरअपील िं./ I.T.A. No.3440/Mum/2009 (धििाारण वर्ा / Assessment Year: 2005-06) M/S Peninsula Land Limited Dcit – 7(1), (Previously Known As Morarjee Realties Ltd.) 622, Aaykar Bhavan Peninsula Spenta, 2Nd Floor बिाम M. K. Marg Mathuradas Mills Compound, Mumbai – 400 020 / Vs. Senapati Bapat Marg, Lower Parel, Mumbai-400 013 स्थायीलेखा िं./ जीआइआर िं./ Pan/Gir No. Aaact-5173-A (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : & आयकरअपील िं./ I.T.A. No. 3696/Mum/2009 (धििाारण वर्ा / Assessment Year: 2005-06) Dcit – 7(1), M/S Peninsula Land Limited 622, Aaykar Bhavan (Previously Known As Morarjee Realties Ltd.) Peninsula Spenta, 2Nd Floor बिाम/ M. K. Marg Mumbai – 400 020 Mathuradas Mills Compound, Vs. Senapati Bapat Marg, Lower Parel, Mumbai-400 013 स्थायीलेखा िं./ जीआइआर िं./ Pan/Gir No. Aaact-5173-A (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : Assessee By : Shri Vijay Mehta - Ld. Ar Revenue By : Shri H. N. Singh – Ld. Cit-Dr ुनवाई की तारीख / : 05/08/2021 Date Of Hearing घोषणा की तारीख / : 27/10/2021 Date Of Pronouncement

For Appellant: Shri Vijay Mehta - Ld. ARFor Respondent: Shri H. N. Singh – Ld. CIT-DR
Section 143(3)Section 35D

…ch was never received by the assessee could not be brought to tax as capital gains or business income as held by Hon’ble Apex Court in K.P.Varghese & Co. (131 ITR 597) and in various other decisions. The reliance of Ld. AO on the decision of McDowells and Co.(154 ITR 148) was out of context since the transactions, in the present case, were entered into within the framework of law and by no stretch of imagination, these could be considered as colorable device. As against this, the decision in UOI V/s Azadi Bachao Andolan (263 ITR 703) held that an act which was otherwise valid in law could not be treated as non- e…

ACIT, Circle-8(1), New Delhi vs. Arihant Kumar Jain, New Delhi

ITA 5342/DEL/2018[2014-15]Status: DisposedITAT Delhi27 Oct 2021AY 2014-15

Bench: Shri Kuldip Singh & Shri Prashant Maharishi

For Appellant: Shri Raj Kumar Gupta, CAFor Respondent: Shri Prakash Dubey, Senior DR
Section 10(38)Section 133ASection 143Section 68

…t is essential on the part of the Assessing Officer to look into the real nature of transaction and what happens in the real word and contextualize the same to such transactions in the real market situation. Further, in the case of McDowell &: Co. Ltd.[(1985) 154 ITR 148 (SC)],the Hon'ble Supreme Court have observed as under: "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax 15 ITA No.5342/Del./2018 planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods. It…

M/S Sobha Interiors (P) Ltd vs. The Deputy Commissioner of Income Tax

In the result, both the appeals stand dismissed

ITA/164/2017HC Karnataka05 Oct 2021

Bench: S.SUJATHA,RAVI V HOSMANI

Section 23Section 260Section 260A

…IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 5TH DAY OF OCTOBER, 2021 PRESENT THE HON’BLE MRS.JUSTICE S.SUJATHA AND THE HON’BLE MR. JUSTICE RAVI V. HOSMANI I.T.A.No.164/2017 C/w. I.T.A.No.166/2017 IN ITA NO.164/2017: BETWEEN : M/S SOBHA INTERIORS (P) LTD E-106, SUNRISE CHAMBERS, 322, ULSOOR ROAD, BANGALORE - 560 022. PAN: AAECS62751560022. ...APPELLANT (BY SRI ANNAMALAI, ADV. FOR SRI M.LAVA, ADV.) AND : 1. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE - 12(3) PRESENTLY CIRCLE- 6(1)(2) BMTC BUILDING, 80 FEET ROAD, KORAMANAGALA BANGALORE - 5…

Mr.Ripu Sudan Kundra, Mumbai vs. ITO 3(1)(1), Mumbai

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

ITA 2792/MUM/2018[2014-15]Status: DisposedITAT Mumbai05 Oct 2021AY 2014-15

Bench: Shri Mahavir Singh () & Shri S. Rifaur Rahman () Assessment Year: 2014-15 Mr. Ripu Sudan Kundra, Ito-3(1)(1), 1Stflr. 57/A, Plot No. 3 Ct S1 Vs. Mumbai. Gandhi Gram Road, Near Sunny S Jamaica Consultatejuhu, Vile Parle (W), Mumbai-400049. Pan No. Azupk 9777 F Appellant Respondent Assessee By : Ms. Ritu Kamal Kishor, Ar Revenue By : Ms. Leena Srivastav, Cit-Dr Date Of Hearing : 12/07/2021 Date Of Pronouncement : 05/10/2021

For Appellant: Ms. Ritu Kamal Kishor, ARFor Respondent: Ms. Leena Srivastav, CIT-DR
Section 143Section 143(2)Section 143(3)Section 71

…planning and it is wrong to encourage or entertain the belief that it is honorable to avoid the payment of tax by dubious methods. It is obligation of every citizen to pay the taxes honestly without resorting to subterfuges (M/s. McDowell's Co, Ltd Vs. CTO in 154 ITR 148). ii. There is behind taxation laws as much moral sanction as is behind any other welfare legislation and it is a pretense to say that avoidance of taxation is not unethical and that it stands on no less a moral plane than while considering a device to avoid tax, is not to asks whether the provisions should be constructed literally or liberally n…

The DCIT Cir 7(1), Mumbai vs. M/S. Piramal Enterprises Ltd., Mumbai

In the result, appeal of the assessee in ITA

ITA 4345/MUM/2007[2003-2004]Status: DisposedITAT Mumbai05 Oct 2021AY 2003-2004

Bench: Known As Nicholas Piramal Mumbai - 400020 India Ltd.,) Piramal Tower, Ganpatrao Kadam Marg Lower Parel, Mumbai-400013 Pan/Gir No.Aaacn4538P (Appellant) .. (Respondent) Dcit. Circle 7(1), Vs. M/S. Piramal Enterprises Ltd. Aayakar Bhavan (Formerly Known As Piramal Healthcare Mumbai - 400020 Ltd.,) (Before Known As Nicholas Piramal India Ltd.,) Piramal Tower, Ganpatrao Kadam Marg Lower Parel, Mumbai-400013 Pan/Gir No.Aaacn4538P (Appellant) .. (Respondent) M/S. Piramal Enterprises Ltd. Vs. Deputy Commissioner Of Income (Formerly Known As Piramal Tax Healthcare Ltd.,) Range 7(3)(2), (Before Known As Nicholas Piramal Mumbai - 400020 India Ltd.,) Piramal Tower, Ganpatrao Kadam Marg Lower Parel, Mumbai-400013 Pan/Gir No.Aaacn4538P (Appellant) .. (Respondent) M/S. Piramal Enterprises Limited

Section 143(3)

…Thus, the redemption of preference shares by GBDFC out of the equity share capital money infused by Nidus before the merger was a colourable device to reduce the tax liability, therefore, following the decision of Hon'ble Apex Court in McDowell and Co. Ltd. (154 ITR 148), the long term capital loss is not allowable. 21.3. Aggrieved by this enhancement, the assessee has raised ground No. XI before us on merits. 21.4. At the outset, the ld. AR vehemently pointed out that NIDUS, BMK and NOZAKI are not related parties at all. This allegation leveled by the ld. CIT(A) is absolutely without any documentary evidence…

Ankur Aggarwal, New Delhi vs. ITO Ward - 40(1), New Delhi

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

ITA 124/DEL/2020[2015-16]Status: DisposedITAT Delhi29 Sept 2021AY 2015-16

Bench: Shri Amit Shukla & Shri Prashant Maharishi(Through Video Conferencing)

For Appellant: Shri Kapil Goel, AdvocateFor Respondent: Shri K. A. Manu, Sr. D.R
Section 10Section 10(38)Section 143(2)Section 68

…8/2017 dated 10th April, 2017 held that assessee has indulged in dubious transactions meant for non- genuine credit under Section 68 of the Act. He further relied upon the decision of the Hon’ble Supreme Court in the case of McDowell & Co. Ltd. Vs. CTO (1985) 154 ITR 148 (SC). He further referred to the finding of the Special Investigation Team Report by two highly respected judges of the Supreme Court, Hon’ble Mr. Justice M. B. Shah and Hon’ble Mr. Justice Dr. Arijit Pasayat. He further referred to the decision of the Hon’ble Supreme Court in the case of Sumati Dayal Vs. CIT 214 ITR 801 (SC) with respect to the…

The Income Tax Officer, Amritsar vs. M/S Bhagat Industrial Corporation Ltd., Amritsar

The appeal of the Revenue is allowed for statistical purposes and CO is also allowed for statistical purposes

ITA 408/ASR/2016[2007-08]Status: DisposedITAT Amritsar17 Sept 2021AY 2007-08

Bench: Sh. Laliet Kumar & Dr. M. L. Meena

Section 143(3)

…IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE SH. LALIET KUMAR, JUDICIAL MEMBER AND DR. M. L. MEENA, ACCOUNTANT MEMBER I.T.A. No. 408/Asr/2016 Assessment Year: 2007-08 Income Tax Officer, Vs. M/s Bhagat Industrial Ward- 5(1), Amritsar. Corporation Ltd., V.P.O. Khasa, Amritsar [PAN: AAACB 7368P] (Appellant) (Respendent) C.O. No. 21/Asr/2016 (In I.T.A. No. 408/Asr/2016) Assessment Year: 2007-08 M/s Bhagat Industrial Vs. Income Tax Officer, Corporation Ltd., V.P.O. Ward- 5(1), Amritsar. Khasa, Amritsar [PAN: AAACB 7368P] (Appellant) (Respendent) Appellant by Sh. Sanjay Dhariwa…

Rational Art & Press P.Ltd, Mumbai vs. DCIT Cen Cir 44, Mumbai

In the result, the appeal of the assessee is partly allowed

ITA 7615/MUM/2016[2010-11]Status: DisposedITAT Mumbai24 Aug 2021AY 2010-11
Section 143(3)

…4. We find that the Hon‟ble Jurisdictional High Court held as under:- 6. We have given our anxious consideration to the matter. Considerable time was spent as to whether there has been a departure from the ratio decedendi in McDowell & Co. Ltd. v. CTO [1985] 154 ITR 148 (SC) in the case of Union of India v.AzadiBachaoAndolan[2003] 263 ITR 706 (SC). We may address ourselves to that issue. The judgment in McDowell & Co.'s case (supra) was of a Constitution Bench. The majority judgment insofar as the issue of colourable exercise and tax planning observed as under:— "Tax planning may be legitimate provided it is wit…

Surya Kant Gupta, Gurgaon vs. ITO Ward - 4(2), Gurgaon

Appeal of the assessee is allowed

ITA 7828/DEL/2019[2015-16]Status: DisposedITAT Delhi18 Aug 2021AY 2015-16

Bench: Ms Suchitra Kamble & Shri Prashant Maharishi

Section 55(2)(aa)

…icer the motive of the assessee in dealing in the shares of HCL Technologies Ltd. was Tax Avoidance and Dubious Tax Planning and the Assessing Officer applied ratio of the decision of the Hon'ble Supreme Court in case of McDowell & Company Ltd. Vs. ITO (1985) 154 ITR 148. The Ld. AR submitted that the decision of the Hon’ble Apex Court in case of McDowell & Company Ltd. establish the principal that the bonafide business arrangement with incidental fall out by way of tax benefit can be tolerated but tax avoidance or tax evasion by means of a colourable device or make belief transaction and dubious means cannot be…

Brash Steels Pvt Ltd, Faridabad vs. ITO Ward - 1(2), Faridabad

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

ITA 6181/DEL/2019[2015-16]Status: DisposedITAT Delhi17 Aug 2021AY 2015-16

Bench: Shri R.K. Pandaassessment Year : 2015-16 M/S Brash Steels Pvt. Ltd. Vs. Ito, Ff-9, Vishnu Place, Near Ward-1(2), Neelam Flyover, Sector-20B, Faridabad, Faridabad, Haryana-121002 Haryana-121002 Pan-Aafcb0204R

For Appellant: Sh. Rajiv Saxena, AdvocateFor Respondent: Sh. Farat Khan, Sr. DR
Section 11USection 133(6)Section 56(2)(viib)Section 68

…ingredients of section 68 of the IT Act. Rejecting the various explanations given by the assessee and following the decisions of the Hon’ble 3 Supreme Court in the case of CIT vs. Durga Prasad More reported in 82 ITR 540, McDowell & Co. Ltd. vs. CTO (1985) 154 ITR 148 and Sumati Dayal vs. CIT (1995) 214 ITR 802, the AO made addition of Rs.45,80,000/- to the total income of the assessee u/s 68 of the IT Act being the whole of share capital and share premium. While doing so, the AO further observed that since the addition on account of share premium and share capital has already been made u/s 68 of the Act, n…

Asst CIT CC 1 (1), Mumbai vs. Shri. Babubhai V Patel, Navi Mumbai

In the result, both the appeals filed by the Revenue stand dismissed

ITA 7470/MUM/2019[2012-13]Status: DisposedITAT Mumbai11 Aug 2021AY 2012-13

Bench: The Hon'Ble Supreme Court Of India In Various Other Appeals. 2. Whether On The Facts & Circumstances Of The Case & In Law, The Ld.Cit(A) Was Correct In Narrowing Down The Scope Of Assessment U/S. 153A In Respect Of Completed Assessments By Holding That Only Undisclosed Income & Undisclosed Assets Detected During The Search Could Be Brought To Tax. 3. Whether On The Facts & Circumstances Of The Case & In Law, The Ld. Cit (A) Was Correct In Holding That The Scope Of Section 153A Is Limited To Assessing Only Search Related Income, Thereby Denying Revenue, The 2 Shri Babubhai V. Patel

Section 131(1)(d)Section 153ASection 68Section 69C

…rima facie evidence against the assessee, viz., the receipt of money, and if he fails to rebut the same, the said evidence being unrebutted, can be used against him by holding that it is a receipt of an income nature." In the case of McDowell & Co Ltd (1985) 154 ITR 148, the following observation was made by the Supreme Court, "Colourable devices cannot be 5 Shri Babubhai V. Patel part of tax planning and it is wrong to encourage or entertain the belief that if its honourable to avoid the payment of tax by resorting to dubious methods. It is the obligation of every citizen to pay the taxes honestly without reso…

Dalmia Bharat Sugar & Industries Ltd, New Delhi vs. Deputy Commissioner of Income-Tax, New Delhi

In the result appeal of the assessee for assessment year 2007 – 08 is partly allowed and appeal of the learned assessing officer for that year is dismissed

ITA 1044/DEL/2015[2005-06]Status: DisposedITAT Delhi03 Aug 2021AY 2005-06

Bench: Shri Prashant Maharishi & Shri K.N.Chary(Through Video Conferencing) M/S. Dalmia Bharat Sugar & Dcit, Industries Ltd. [Formerly Known Vs. As Dalmia Cement (Bharat) Ltd. Circle – 1, Ltu, 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dcit, M/S. Dalmia Bharat Sugar Circle – 1, Ltu, Vs. & Industries Ltd., New Delhi. 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dalmia Cement (Bharat) Ltd, Vs. Acit (Ltu), (Now Known As Dalmia Bharat Nbcc Plaza, New Delhi Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K (Appellant) (Respondent) Acit (Ltu), Vs. Dalmia Cement (Bharat) Ltd, Nbcc Plaza, New Delhi (Now Known As Dalmia Bharat Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K

For Appellant: Shri R. M. Mehta, FCAFor Respondent: Ms. Nidhi Srivastava, CIT DR
Section 143Section 254

…d offered for taxation, it does not entitle the assessee to claim depreciation on the power plant. vi. The whole transaction is a perfect case to apply the ratio laid down by the decision of the Supreme Court in McDowell & Co Ltd versus commercial tax Officer 154 ITR 148. She further relied upon the several judicial precedents mentioned by the learned assessing officer. vii. With respect to the claim of payment of power charges by assessee of ₹ 35 lakhs she referred to the power purchase agreement and submitted that in the financial year ended on 31st of March 2005, that company when did not produce a single unit…

DCIT, New Delhi vs. Dalmia Bharat Sugar & Industries Ltd, New Delhi

In the result appeal of the assessee for assessment year 2007 – 08 is partly allowed and appeal of the learned assessing officer for that year is dismissed

ITA 1036/DEL/2015[2005-06]Status: DisposedITAT Delhi03 Aug 2021AY 2005-06

Bench: Shri Prashant Maharishi & Shri K.N.Chary(Through Video Conferencing) M/S. Dalmia Bharat Sugar & Dcit, Industries Ltd. [Formerly Known Vs. As Dalmia Cement (Bharat) Ltd. Circle – 1, Ltu, 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dcit, M/S. Dalmia Bharat Sugar Circle – 1, Ltu, Vs. & Industries Ltd., New Delhi. 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dalmia Cement (Bharat) Ltd, Vs. Acit (Ltu), (Now Known As Dalmia Bharat Nbcc Plaza, New Delhi Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K (Appellant) (Respondent) Acit (Ltu), Vs. Dalmia Cement (Bharat) Ltd, Nbcc Plaza, New Delhi (Now Known As Dalmia Bharat Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K

For Appellant: Shri R. M. Mehta, FCAFor Respondent: Ms. Nidhi Srivastava, CIT DR
Section 143Section 254

…d offered for taxation, it does not entitle the assessee to claim depreciation on the power plant. vi. The whole transaction is a perfect case to apply the ratio laid down by the decision of the Supreme Court in McDowell & Co Ltd versus commercial tax Officer 154 ITR 148. She further relied upon the several judicial precedents mentioned by the learned assessing officer. vii. With respect to the claim of payment of power charges by assessee of ₹ 35 lakhs she referred to the power purchase agreement and submitted that in the financial year ended on 31st of March 2005, that company when did not produce a single unit…

DCIT (Ltu), New Delhi vs. M/S. Dalmia Cement (Bharat) Ltd., New Delhi

In the result appeal of the assessee for assessment year 2007 – 08 is partly allowed and appeal of the learned assessing officer for that year is dismissed

ITA 4166/DEL/2014[2007-08]Status: DisposedITAT Delhi03 Aug 2021AY 2007-08

Bench: Shri Prashant Maharishi & Shri K.N.Chary(Through Video Conferencing) M/S. Dalmia Bharat Sugar & Dcit, Industries Ltd. [Formerly Known Vs. As Dalmia Cement (Bharat) Ltd. Circle – 1, Ltu, 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dcit, M/S. Dalmia Bharat Sugar Circle – 1, Ltu, Vs. & Industries Ltd., New Delhi. 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dalmia Cement (Bharat) Ltd, Vs. Acit (Ltu), (Now Known As Dalmia Bharat Nbcc Plaza, New Delhi Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K (Appellant) (Respondent) Acit (Ltu), Vs. Dalmia Cement (Bharat) Ltd, Nbcc Plaza, New Delhi (Now Known As Dalmia Bharat Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K

For Appellant: Shri R. M. Mehta, FCAFor Respondent: Ms. Nidhi Srivastava, CIT DR
Section 143Section 254

…d offered for taxation, it does not entitle the assessee to claim depreciation on the power plant. vi. The whole transaction is a perfect case to apply the ratio laid down by the decision of the Supreme Court in McDowell & Co Ltd versus commercial tax Officer 154 ITR 148. She further relied upon the several judicial precedents mentioned by the learned assessing officer. vii. With respect to the claim of payment of power charges by assessee of ₹ 35 lakhs she referred to the power purchase agreement and submitted that in the financial year ended on 31st of March 2005, that company when did not produce a single unit…

Dalmia Bharat Sugar and Industries Ltd., New Delhi vs. DCIT (Ltu), New Delhi

In the result appeal of the assessee for assessment year 2007 – 08 is partly allowed and appeal of the learned assessing officer for that year is dismissed

ITA 4124/DEL/2014[2007-08]Status: DisposedITAT Delhi03 Aug 2021AY 2007-08

Bench: Shri Prashant Maharishi & Shri K.N.Chary(Through Video Conferencing) M/S. Dalmia Bharat Sugar & Dcit, Industries Ltd. [Formerly Known Vs. As Dalmia Cement (Bharat) Ltd. Circle – 1, Ltu, 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dcit, M/S. Dalmia Bharat Sugar Circle – 1, Ltu, Vs. & Industries Ltd., New Delhi. 11Th & 12Th Floors, Hansalaya, 15 – Barakhamba Road, New Delhi – 110 001. Pan: Aaacd2281K (Appellant) (Respondent) Dalmia Cement (Bharat) Ltd, Vs. Acit (Ltu), (Now Known As Dalmia Bharat Nbcc Plaza, New Delhi Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K (Appellant) (Respondent) Acit (Ltu), Vs. Dalmia Cement (Bharat) Ltd, Nbcc Plaza, New Delhi (Now Known As Dalmia Bharat Sugar & Industries Ltd), Hansalya, 11Th & 12Th Floors, 15, Barakhamba Road, New Delhi Pan: Aaacd2281K

For Appellant: Shri R. M. Mehta, FCAFor Respondent: Ms. Nidhi Srivastava, CIT DR
Section 143Section 254

…d offered for taxation, it does not entitle the assessee to claim depreciation on the power plant. vi. The whole transaction is a perfect case to apply the ratio laid down by the decision of the Supreme Court in McDowell & Co Ltd versus commercial tax Officer 154 ITR 148. She further relied upon the several judicial precedents mentioned by the learned assessing officer. vii. With respect to the claim of payment of power charges by assessee of ₹ 35 lakhs she referred to the power purchase agreement and submitted that in the financial year ended on 31st of March 2005, that company when did not produce a single unit…

DCIT CC 2(4), Mumbai vs. Concord Enviro Systems P. Ltd, Mumbai

In the result, appeal filed by the revenue is allowed for statistical purpose

ITA 3897/MUM/2017[2010-11]Status: DisposedITAT Mumbai26 Jul 2021AY 2010-11
Section 56(1)Section 68

…ion that the assessee is taxable in this regard. He further regarded the transactions as sham and that the assessee was applying subterfuges. The Assessing Officer referred to the decision of Hon'ble Supreme Court in the case of McDowell and Co. Ltd. Vs. CTO (154 ITR 148). He finally concluded as under :- “In view of the facts as discussed above the contention of the assessee as made out in this issue are rejected in the manner as discussed above and the difference between the fair market value of the shares purchased during the year and the value of its purchase consideration as declared by the assessee is requ…

Mrs Pratibha S. Mhatre, Mumbai vs. Income Tax Officer 4(3), Thane

In the result, appeal is allowed

ITA 695/MUM/2018[2014-15]Status: DisposedITAT Mumbai11 Jun 2021AY 2014-15

Bench: Shri Mahavir Singh & Shri S. Rifaur Rahman

For Appellant: Shri Neelkanth KhandelwalFor Respondent: Ms. Shreekala
Section 10(38)Section 68

…an advantage of an artificially' created market situation to exploit and avoid taxation. (vii) A reference may gainfully be made to the following judicial pronouncement of the Hon'ble Supreme Court. In the case of Mcdowell & Co. Ltd. v. CTO [1985] reported in 154 ITR 148, the Hon'ble Supreme Court held and observed as under: "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious methods. It is the obligation of every c…

The Investment Trust of India Ltd., Chennai vs. ACIT, Chennai

In the result appeal filed by the assessee for

ITA 1809/CHNY/2014[2009-10]Status: DisposedITAT Chennai17 May 2021AY 2009-10

Bench: Shri Mahavir Singh, Vice- & Shri G.Manjunatha

For Appellant: Mr.R.Vijayaraghavan, Advocate

…tax authorities to question the amalgamation if the purpose is ITA Nos. 80, 728 & 1377/Chny/2008, 498/Chd/2007 & 1809/Chny/2014 evasion of tax. The learned CIT(A) ought to have followed the decision of the Supreme Court in the case of Mcdowell Co. Ltd v.CTO 154 ITR 148 and the decision of the Bombay High Court as reported in Economic times dated 14.10.2006 wherein the High Court has held relying on the decision of the Supreme Court in the case of Mihir H Mafatlal Industries Ltd that amalgamation can be rejected on grounds of tax evasion and said that Court can verify whether amalgamation was a genuine corporate…