Prem Conductors (P.) Ltd. v. CIT

108 ITR 654High Court1977#10065 most cited

What is Prem Conductors (P.) Ltd. v. CIT authority for?

The commencement of business activity, such as securing orders, precedes the commencement of production and forms part of the business activity. Therefore, the business is considered to have commenced when such preparatory activities begin, not necessarily upon the start of actual production.

10

judgments rely on this decision, according to BharatTax’s citation analysis of 366,314 Indian tax judgments — from 2012 to 2020.

Also referred to as

Prem Conductors · commencement of business · securing orders · production · business activity · Gujarat High Court · 1977

Judgments citing Prem Conductors (P.) Ltd. v. CIT

Btw-Atlanta Transformers India Pvt. Ltd., Bharuch vs. ACIT, Circle-1(1)(1), Vadodara

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

ITA 1642/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad06 Mar 2020AY 2013-14
For Appellant: Shri S.N.Soparkar, A.RFor Respondent: Shri Vidhyut Trivedi, Sr. D.R
Section 115JSection 143(2)Section 143(3)Section 154

…at date. In the case of CIT Vs. Samsung India Electronics Ltd. (2013) 37 taxmann.com 239 (Delhi) the assessee company was ready to commence trading operation as on the date of incorporation viz. 3.8.1995. In the case of Prem Conductors (P) Ltd. Vs. CIT (1977) 108 ITR 654 (Guj.) it was seen that assessee company has started accepting orders for production of goods since very date of its I.T.A No. 1642 & 1643/Ahd/2018 A.Y. 2013-14 & 2014-15 Page No 8 Shri BTW-Atlanta Transformers India Pvt. Ltd. vs. ACIT incorporation. In the light of the facts of the case, material on records and judicial findings, we consider it…

M/S Sambhav Institutions (India) Private Limited, Bangalore vs. Income Tax Officer Ward-12(2), Bangalore

In the result, all the three appeals filed by the assessee are allowed for statistical purposes

ITA 1760/BANG/2018[2010-11]Status: DisposedITAT Bangalore31 Jul 2019AY 2010-11

Bench: Shri Arun Kumar Garodia & Shri Pavan Kumar Gadale

For Appellant: Shri Siddesh Gaddi, CAFor Respondent: Dr. P.V. Pradeep Kumar, Addl. CIT (DR)
Section 271(1)(c)

…by the Honourable Supreme Court in the case of CIT vs. Sarabhai Management Corpn. Ltd. [1991] 192 ITR 151 (SC). 3.13. Reference can be made and reliance can be placed on the ruling of the Honourable Court in the case of Prem Conductors (P.) Ltd. Vs CIT [1977] 108 ITR 654 (GUJ.) wherein it was observed and held as under The business of the company was to manufacture aluminum and other conductors and to sell them. In the instant case, the company has started securing orders well in advance of the date on which it actually started production of aluminum conductors. The selling of aluminum conductors manufactured by…

M/S Sambhav Institutions (India) Private Limited, Bangalore vs. Income Tax Officer Ward-12(2), Bangalore

In the result, all the three appeals filed by the assessee are allowed for statistical purposes

ITA 1759/BANG/2018[2009-10]Status: DisposedITAT Bangalore31 Jul 2019AY 2009-10

Bench: Shri Arun Kumar Garodia & Shri Pavan Kumar Gadale

For Appellant: Shri Siddesh Gaddi, CAFor Respondent: Dr. P.V. Pradeep Kumar, Addl. CIT (DR)
Section 271(1)(c)

…by the Honourable Supreme Court in the case of CIT vs. Sarabhai Management Corpn. Ltd. [1991] 192 ITR 151 (SC). 3.13. Reference can be made and reliance can be placed on the ruling of the Honourable Court in the case of Prem Conductors (P.) Ltd. Vs CIT [1977] 108 ITR 654 (GUJ.) wherein it was observed and held as under The business of the company was to manufacture aluminum and other conductors and to sell them. In the instant case, the company has started securing orders well in advance of the date on which it actually started production of aluminum conductors. The selling of aluminum conductors manufactured by…

M/S Sambhav Institutions (India) Private Limited, Bangalore vs. Income Tax Officer Ward-12(2), Bangalore

In the result, all the three appeals filed by the assessee are allowed for statistical purposes

ITA 1758/BANG/2018[2008-09]Status: DisposedITAT Bangalore31 Jul 2019AY 2008-09

Bench: Shri Arun Kumar Garodia & Shri Pavan Kumar Gadale

For Appellant: Shri Siddesh Gaddi, CAFor Respondent: Dr. P.V. Pradeep Kumar, Addl. CIT (DR)
Section 271(1)(c)

…by the Honourable Supreme Court in the case of CIT vs. Sarabhai Management Corpn. Ltd. [1991] 192 ITR 151 (SC). 3.13. Reference can be made and reliance can be placed on the ruling of the Honourable Court in the case of Prem Conductors (P.) Ltd. Vs CIT [1977] 108 ITR 654 (GUJ.) wherein it was observed and held as under The business of the company was to manufacture aluminum and other conductors and to sell them. In the instant case, the company has started securing orders well in advance of the date on which it actually started production of aluminum conductors. The selling of aluminum conductors manufactured by…

DCIT -1(3)(2), Mumbai vs. Tata Lockheed Martinaerostructures Ltd., Hyderabad

In the result , appeal of the Revenue is partly allowed as indicated above

ITA 2667/MUM/2016[2011-12]Status: DisposedITAT Mumbai08 Aug 2018AY 2011-12

Bench: Shri Saktijit Dey & Shri Ramit Kochar

For Appellant: Ms. Arati VissanjiFor Respondent: Shri V. Justin,DR
Section 143(3)Section 14A

…by the assessee at Hyderabad and the business was set up when the said orders were received for execution by the assessee. The assessee counsel strongly relied on the decision of Hon‟ble Gujarat High Court in the case of Prem Conductors P. Ltd. v. CIT (1976) 108 ITR 654(Guj. HC). The Ld. DR in rejoinder submitted that setting up of the business and commencement of the business are one and the same thing within meaning of Section 3 of the 1961 Act and no distinction can be drawn . It was vehemently and strongly argued by learned DR that the assessee is not entitled for relief by way of allowability of expenses…

M/S. Tera Estates Pvt. Ltd., New Delhi vs. ACIT, New Delhi

In the result, we allow ground No

ITA 1657/DEL/2014[2006-07]Status: DisposedITAT Delhi08 Nov 2017AY 2006-07

Bench: Shri H.S.Sidhu & Shri Prashant Maharishitera Estates Pvt. Ltd, Vs. Acit, S-395, Greater Kailash, Parti-Ii, Range-16, New Delhi New Delhi Pan:Aabct5729R (Appellant) (Respondent)

For Appellant: Shri Arvind Kumar, AdvFor Respondent: Shri Shravan Gotru, Sr. DR
Section 143(3)Section 24

…n of assessment year is accepted u/s 143(1) or is subject to scrutiny u/s 143(3). 7. Reliance is also placed on the decisions of High Court of Gujarat in CIT Vs. Saurashtra Cement and Chemical Industrial Ltd. 91 ITR 170 and in Prem Conductors (P) Ltd. Vs. CIT 108 ITR 654 to submit that in facts of the case the business of the appellant company had commenced and therefore both the Ld. A.O. and CIT (A) have erred in holding that since the business had not commenced or is not in existence therefore the necessary expenses incurred for the business or not allowable. 8. Reliance is placed on the decision in case of Ind…

ACIT 10(1), Mumbai vs. Gattefosse India P. Ld, Mumbai

In the result, appeal of revenue is dismissed

ITA 333/MUM/2013[2009-10]Status: DisposedITAT Mumbai04 Mar 2016AY 2009-10
For Appellant: Ms. Sonalee GodboleFor Respondent: Smt. Anu K. Aggarwal
Section 3

…iness it is 'not set up. There may however be an interval between the setting up of the business and the commencement of the business and all expenses incurred during that interval would be permissible deductions", (i) Prem Conductors Pvt. Ltd. vs. CIT (1977) 108 ITR 654 (Guj.), "It was held that the test to be applied is as to when a business man would regard a business as being commenced and the approach must be from a common sense point of view. In case of the activity of securing orders before commencement of actual production, it was held that the business had commenced though the actual production has not s…

DCIT, New Delhi vs. M/S Dlf Homes Panchkula Pvt. Ltd., New Delhi

In the result appeal of the department is dismissed

ITA 4344/DEL/2012[2009-10]Status: DisposedITAT Delhi14 Oct 2015AY 2009-10

Bench: Sh. N. K. Saini, Am & Sh. C. M. Garg, Jm Ita No. 4344/Del/2012 : Asstt. Year : 2009-10 Dcit, Vs M/S Dlf Homes Panchkula Pvt. Ltd. Circle-10(1), 1-E, Naaz Cinema Complex, New Delhi Jhandewalan Extn., New Delhi (Appellant) (Respondent) Pan No. Aabch8735M Assessee By : Sh. R. S. Singvi, Ca Revenue By: Smt. Parwinder Kaur, Sr. Dr Date Of Hearing : 31.07.2015 Date Of Pronouncement : 14.10.2015 Order Per N.K. Saini, A.M. This Is An Appeal By The Department Against The Order Dated 24.05.2012 Of The Ld. Cit(A)-Xiii, New Delhi.

For Appellant: Sh. R. S. Singvi, CAFor Respondent: Smt. Parwinder Kaur, Sr. DR
Section 4Section 5A

…ts in lands. Therefore, all the expenses incurred by the assessee after set up of its business were allowable. The reliance was placed on the following case laws: " CIT Vs Sarabhai 192 ITR 151 " Western India Vegetable Products Vs CIT 26 ITR 151 " Prem Vs CIT 108 ITR 654 8 DLF Homes Panchkula Pvt. Ltd. " CIT Vs Western India 199 ITR 777 " CIT Vs Piem Hotel 209 ITR 616 " CIT Vs L G Electronics (India) Ltd. (2006) 282 ITR 545 (Del) " CIT Vs Herbalife International India (P) Ltd. 297 ITR 303 (Del) " CIT Vs Sarabhai Management Corpn. Ltd. (1991) 192 ITR 151 " Whirlpool of India Ltd. Vs JCIT (2008) 19 SOT 593 " CIT V…

Omniglobe Information Tech India Pvt Ltd

ITA/257/2012HC Delhi11 Aug 2014
Section 10B

…other activities is started; as business connotes continuous course of activity and all activities which go up to make the business, need not be started simultaneously. 19. Similar view was again taken in Prem Conductors Private Limited Vs. CIT, (1997) 108 ITR 654 (Guj.) wherein it has been elucidated that one business activity might precede another and what was required to be seen was whether one of the essential activities for carrying on the business as a whole had or had not commenced. When the assessee had commenced business of securing orders first and then production, then activity of securing…

The Commissioner of Income Tax- I vs. M/s. Avon Organics Limited

ITTA/257/2012HC Telangana17 Jul 2012

Bench: GODA RAGHURAM,M.S.RAMACHANDRA RAO