S.A. Builders Ltd. v. CIT

288 ITR 1Supreme Court of India2007#26 most cited

What is S.A. Builders Ltd. v. CIT authority for?

Interest paid on borrowed funds cannot be disallowed merely because the assessee made interest-free advances, provided those advances were made for business purposes and commercial expediency. The Revenue cannot dictate a businessman's commercial decisions, but the assessee bears the onus to prove the business expediency.

1,484

judgments rely on this decision, according to BharatTax’s citation analysis of 367,368 Indian tax judgments — from 2008 to 2026.

Also referred to as

S.A. Builders Ltd. v. CIT · 288 ITR 1 · Section 36(1)(iii) · commercial expediency · business expediency · interest-free advances · disallowance of interest · onus to prove business purpose · borrowed funds · Revenue interference

Also reported as

158 Taxmann 74158 Taxmann.com 74

Sections most often in play

Section 143(3)Section 36(1)(iii)Section 14ASection 1961Section 148Section 147Section 40(a)(ia)Section 142(1)
Read the full judgment

Issues it is cited on

commercial expediencyinterest free advancessection 36(1)(iii)business expediencydisallowance of interest expendituresection 36(1)section 36revenue expendituresection 37(1)section 37capital expendituresection 14a

Judgments citing S.A. Builders Ltd. v. CIT

Allen Career Institute, Jaipur vs. JCIT, Kota

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

ITA 620/JPR/2016[2011-12]Status: DisposedITAT Jaipur04 Aug 2022AY 2011-12
For Appellant: Shri Mahendra Gargieya, Advocate &For Respondent: Shri A.S. Nehra, Addl. CIT
Section 143(3)Section 36Section 36(1)(iii)Section 37(1)

…ny which in this case was a subsidiary company is one which should be treated as promoted by commercial expediency, The Supreme Court upheld the argument of the assessee and interest was not disallowed in the case of S.A. Builders Ltd. Vs. CIT (Appeal) (2007) 288 ITR 1 (SC) Also see CIT Vs. Prem Heavy Engg. Works Pvt. Ltd. (2006) 285 ITR 554 (All), CIT Vs. Radico Khaitan Ltd. (2005) 142 Taxman 681 (All.). The copy of case of is enclosed. Reliance is also placed on the decision of the Hon’ble Bombay high court in the case od CIT v. Reliance Utilities and Power Ltd. 313 ITR 340 and Hon’ble Delhi High Court in the c…

Allen Career Institute, Jaipur vs. JCIT, Kota

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

ITA 246/JPR/2015[2010-11]Status: DisposedITAT Jaipur04 Aug 2022AY 2010-11
For Appellant: Shri Mahendra Gargieya, Advocate &For Respondent: Shri A.S. Nehra, Addl. CIT
Section 143(3)Section 234ASection 244ASection 36(1)(iii)

…and none can be forced to charge interest. In DCIT v/s Gujarat Narmada Valley Fertilizers Co. Ltd. (2014) 31 ITR (Trib) 668 (Ahd) at page 671, it is held that “………….., the decision of the Supreme Court in the case of S.A. Builders Ltd. v. CIT(Appeals) [2007] 288 ITR 1 (SC) would not be applicable to the facts of the present case…….” 6.1 No Interest paid on Partners’ Capital on current year profits: Its factually wrong that appellant paid interest on their capital. Factually there was no interest paid w.r.t. huge net-profits of Rs.53.02 Cr. before depreciation and Rs. 50.76 Cr. after depreciation, of this year in…

M/S. Balkrishna Live Stock Breeders Private Limited, Bengaluru vs. The Assistant Commissioner of Income Tax, Circle-1(1)(2), Bangalore

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

ITA 619/BANG/2021[2017-18]Status: DisposedITAT Bangalore04 Aug 2022AY 2017-18

Bench: Shri Chandra Poojari & Smt. Beena Pillaiassessment Year: 2017-18

For Appellant: Smt. Pratibha R., A.RFor Respondent: Shri Sankar Ganesh K., D.R
Section 37Section 37(1)

…Act. A few of the decisions supporting the rationale and contentions of the assessee by inference are listed as below: (a) CIT Vs Bombay Dyeing and Mfg. Co. Ltd. [1996] 85 Taxman 396 / 219 ITR 521 (SC). (b) S. A. Builders Ltd. Vs CIT [2007] 158 Taxman 74 / 288 ITR 1 (SC). (c) Elgi Equipments Ltd. Vs JCIT, Range-1, Coimbatore [2020] 120 taxmann.com 142 (Madras). (d) CIT Vs Shakti Sugars Ltd., [2010] 194 Taxman 91 / [2011] 339 ITR 400 (Madras). (e) CIT Vs Reliance Supply Chain Solutions Ltd. - IT Appeal No. 892 of 2014 dated July 5, 2017 (Bombay). (f) CIT Vs Evergrowth Telecom Ltd. [2013] 29 taxmann.com 273…

DCIT Cent. Cir-4(2), Mumbai vs. M/S. K. Raheja Pvt. Ltd, Mumbai

In the result, the appeal of the assessee is allowed and the appeal of the Revenue stands dismissed

ITA 2218/MUM/2021[2018-19]Status: DisposedITAT Mumbai03 Aug 2022AY 2018-19

Bench: Shri Aby T. Varkey, Jm & Shri Om Prakash Kant, Am आयकर अपील सं/ I.T.A. No.1970/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) K. Raheja Pvt. Ltd. बिधम/ Dcit Central Circle-4(2) Raheja Tower, Plot No. C- Room No.1918, Air India Vs. 30, Oppo. Sidbi, Bandra Building, Nariman Point- Kurla Complex, Bandra (E), 400021. Mumbai-400051. आयकर अपील सं/ I.T.A. No. 2218/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) Dcit Central Circle-4(2) बिधम/ K. Raheja Pvt. Ltd. Room No.1918, Air India Raheja Tower, Plot No. C-30, Vs. Building, Nariman Point- Oppo. Sidbi, Bandra Kurla 400021. Complex, Bandra (E), Mumbai-400051. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaack1949H (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) Assessee By: Shri Vijay Mehta Revenue By: Smt. Neelam Shukla (Dr) सुनवाई की तारीख / Date Of Hearing: 17/06/2022 घोषणा की तारीख /Date Of Pronouncement: 03/08/2022 आदेश / O R D E R Per Aby T. Varkey, Jm: These Are Cross Appeals Preferred By The Assessee & The Revenue Against The Order Of The Ld. Cit(A)-52, Mumbai Dated 08.09.2021 For The A.Y.2018-19. 2. The Grounds Of Appeal Raised By The Assessee Are As Under: -

For Appellant: Shri Vijay MehtaFor Respondent: Smt. Neelam Shukla (DR)
Section 132Section 132(4)Section 139(1)Section 14A

…aw is that no businessman can be compelled to maximise his profits. The obvious answer to the first question is in the affirmative, in favour of the assessee and against the revenue." 33. The Hon'ble Supreme Court in the case of S.A. Builders Ltd. Vs CIT(A) (288 ITR 1) at para 34 of the order has observed as under:— "34. We agree with the view taken by the Delhi High Court in CIT v. Dalmia Cement (Bharat) Ltd. [2002] 254 ITR 377 that once it is established that there was nexus between the expenditure and the purpose of the business (which need not necessarily be the business of the assessee itself), the Revenue…

K Raheja Pvt. Ltd, Mumbai vs. DCIT Cent. Cir-4(2), `Mumbai

In the result, the appeal of the assessee is allowed and the appeal of the Revenue stands dismissed

ITA 1970/MUM/2021[2018-19]Status: DisposedITAT Mumbai03 Aug 2022AY 2018-19

Bench: Shri Aby T. Varkey, Jm & Shri Om Prakash Kant, Am आयकर अपील सं/ I.T.A. No.1970/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) K. Raheja Pvt. Ltd. बिधम/ Dcit Central Circle-4(2) Raheja Tower, Plot No. C- Room No.1918, Air India Vs. 30, Oppo. Sidbi, Bandra Building, Nariman Point- Kurla Complex, Bandra (E), 400021. Mumbai-400051. आयकर अपील सं/ I.T.A. No. 2218/Mum/2021 (निर्धारण वर्ा / Assessment Year:2018-19) Dcit Central Circle-4(2) बिधम/ K. Raheja Pvt. Ltd. Room No.1918, Air India Raheja Tower, Plot No. C-30, Vs. Building, Nariman Point- Oppo. Sidbi, Bandra Kurla 400021. Complex, Bandra (E), Mumbai-400051. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaack1949H (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) Assessee By: Shri Vijay Mehta Revenue By: Smt. Neelam Shukla (Dr) सुनवाई की तारीख / Date Of Hearing: 17/06/2022 घोषणा की तारीख /Date Of Pronouncement: 03/08/2022 आदेश / O R D E R Per Aby T. Varkey, Jm: These Are Cross Appeals Preferred By The Assessee & The Revenue Against The Order Of The Ld. Cit(A)-52, Mumbai Dated 08.09.2021 For The A.Y.2018-19. 2. The Grounds Of Appeal Raised By The Assessee Are As Under: -

For Appellant: Shri Vijay MehtaFor Respondent: Smt. Neelam Shukla (DR)
Section 132Section 132(4)Section 139(1)Section 14A

…aw is that no businessman can be compelled to maximise his profits. The obvious answer to the first question is in the affirmative, in favour of the assessee and against the revenue." 33. The Hon'ble Supreme Court in the case of S.A. Builders Ltd. Vs CIT(A) (288 ITR 1) at para 34 of the order has observed as under:— "34. We agree with the view taken by the Delhi High Court in CIT v. Dalmia Cement (Bharat) Ltd. [2002] 254 ITR 377 that once it is established that there was nexus between the expenditure and the purpose of the business (which need not necessarily be the business of the assessee itself), the Revenue…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5938/DEL/2019[2017-18]Status: DisposedITAT Delhi02 Aug 2022AY 2017-18

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.As. No.5935, 5936, 5937, 5938/DEL/2019 Assessment Years 2014-15, 2015-16, 2016-17 & 2017-18 Deputy Commissioner of Income Vs. M/s. Bhilwara Energy Ltd., Tax, 40-41, Bhilwara Bhawan, Central Circle-31, Community Centre, New Delhi. New Friends Colony, New Delhi. TAN/PAN: AACCB9081B (Appellant) (Respondent) Appellant by: Shri P.K. Jain, CA Respondent by: Shri Amaresh Singh, CIT-DR Date of hearing: 21 06 2022 Date of pronouncement: 02 08 2022 O R D E R PE…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5937/DEL/2019[2016-17]Status: DisposedITAT Delhi02 Aug 2022AY 2016-17

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.As. No.5935, 5936, 5937, 5938/DEL/2019 Assessment Years 2014-15, 2015-16, 2016-17 & 2017-18 Deputy Commissioner of Income Vs. M/s. Bhilwara Energy Ltd., Tax, 40-41, Bhilwara Bhawan, Central Circle-31, Community Centre, New Delhi. New Friends Colony, New Delhi. TAN/PAN: AACCB9081B (Appellant) (Respondent) Appellant by: Shri P.K. Jain, CA Respondent by: Shri Amaresh Singh, CIT-DR Date of hearing: 21 06 2022 Date of pronouncement: 02 08 2022 O R D E R PE…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5936/DEL/2019[2015-16]Status: DisposedITAT Delhi02 Aug 2022AY 2015-16

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.As. No.5935, 5936, 5937, 5938/DEL/2019 Assessment Years 2014-15, 2015-16, 2016-17 & 2017-18 Deputy Commissioner of Income Vs. M/s. Bhilwara Energy Ltd., Tax, 40-41, Bhilwara Bhawan, Central Circle-31, Community Centre, New Delhi. New Friends Colony, New Delhi. TAN/PAN: AACCB9081B (Appellant) (Respondent) Appellant by: Shri P.K. Jain, CA Respondent by: Shri Amaresh Singh, CIT-DR Date of hearing: 21 06 2022 Date of pronouncement: 02 08 2022 O R D E R PE…

DCIT Central Circle-31, New Delhi vs. Bhilwara Energy Ltd., New Delhi

In the result, all the above captioned appeals of the Revenue are dismissed

ITA 5935/DEL/2019[2014-15]Status: DisposedITAT Delhi02 Aug 2022AY 2014-15

Bench: Shri Challa Nagendra Prasad & Shri Pradip Kumar Kedia

For Appellant: Shri P.K. Jain, CAFor Respondent: Shri Amaresh Singh, CIT-DR
Section 14ASection 153A

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.As. No.5935, 5936, 5937, 5938/DEL/2019 Assessment Years 2014-15, 2015-16, 2016-17 & 2017-18 Deputy Commissioner of Income Vs. M/s. Bhilwara Energy Ltd., Tax, 40-41, Bhilwara Bhawan, Central Circle-31, Community Centre, New Delhi. New Friends Colony, New Delhi. TAN/PAN: AACCB9081B (Appellant) (Respondent) Appellant by: Shri P.K. Jain, CA Respondent by: Shri Amaresh Singh, CIT-DR Date of hearing: 21 06 2022 Date of pronouncement: 02 08 2022 O R D E R PE…

Jurasic Refiners & Jewels Pvt. Ltd. (Formerly Jurassic Finance & Consultants Pvt. Ltd.), Delhi vs. Addl. CIT, Special Range- 5, New Delhi

In the result, the appeal of the assessee is dismissed

ITA 256/DEL/2019[2014-15]Status: DisposedITAT Delhi27 Jul 2022AY 2014-15
Section 143(3)Section 36Section 37(1)Section 73

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “C” BENCH: NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER [Assessment Year : 2014-15] Jurasic Refiners & Jewels Pvt.Ltd. vs Addl. CIT, [Formerly Jurassic Finance & Special Range-5, Consultants Pvt.Ltd.], 11157/1124, New Delhi. 3rd Floor, Kucha Mahajani, Chandni Chowk, Delhi-110028. PAN-AAACJ0754B APPELLANT RESPONDENT Appellant by None Respondent by Shri Rajesh Kumar, CIT DR Date of Hearing 27.07.2022 Date of Pronouncement 27.07.2022 ORDER PER KUL BHARAT, JM : The present appeal filed by the assessee for the assessment ye…

Mafatlal Industries Limited, Mumbai vs. ACIT-6(3), Mumbai

In the result, appeal filed by the assessee is allowed

ITA 4369/MUM/2013[2008-09]Status: DisposedITAT Mumbai25 Jul 2022AY 2008-09

Bench: Shri Amit Shukla, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Arati Vissanji &For Respondent: Nimesh Yadav
Section 143(3)Section 14ASection 36(1)(iii)

…IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, HON'BLE JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER ITA.NO. 6963/MUM/2012 (A.Y. 2007-08) M/s. Mafatlal Industries Limited v. Addl. CIT – 6(3) Mafatlal House, Backbay Reclamation Aayakar Bhavan, M.K. Road H.T. Parekh Marg, Mumbai - 400020 Mumbai - 400020 PAN: AAACM2813L (Appellant) (Respondent) ITA.NO. 4369/MUM/2013 (A.Y. 2008-09) M/s. Mafatlal Industries Limited v. Addl. CIT – 6(3) Kaledonia, Office No.3 Aayakar Bhavan, M.K. Road 6th Floor, Sahar Road Mumbai - 400020 Andheri (E), Mumbai - 400069 PAN: AAACM2…

Mafatlal Industries Ltd, Mumbai vs. Asst CIT 6(3), Mumbai

In the result, appeal filed by the assessee is allowed

ITA 6963/MUM/2012[2007-08]Status: DisposedITAT Mumbai25 Jul 2022AY 2007-08

Bench: Shri Amit Shukla, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Arati Vissanji &For Respondent: Nimesh Yadav
Section 143(3)Section 14ASection 36(1)(iii)

…IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, HON'BLE JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER ITA.NO. 6963/MUM/2012 (A.Y. 2007-08) M/s. Mafatlal Industries Limited v. Addl. CIT – 6(3) Mafatlal House, Backbay Reclamation Aayakar Bhavan, M.K. Road H.T. Parekh Marg, Mumbai - 400020 Mumbai - 400020 PAN: AAACM2813L (Appellant) (Respondent) ITA.NO. 4369/MUM/2013 (A.Y. 2008-09) M/s. Mafatlal Industries Limited v. Addl. CIT – 6(3) Kaledonia, Office No.3 Aayakar Bhavan, M.K. Road 6th Floor, Sahar Road Mumbai - 400020 Andheri (E), Mumbai - 400069 PAN: AAACM2…

Mafatlal Industries Ltd, Mumbai vs. Addl CIT 6(3), Mumbai

In the result, appeal filed by the assessee is allowed

ITA 6085/MUM/2011[2006-07]Status: DisposedITAT Mumbai25 Jul 2022AY 2006-07

Bench: Shri Amit Shukla, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Arati Vissanji &For Respondent: Nimesh Yadav
Section 143(3)Section 14ASection 36(1)(iii)

…IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, HON'BLE JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER ITA.NO. 6963/MUM/2012 (A.Y. 2007-08) M/s. Mafatlal Industries Limited v. Addl. CIT – 6(3) Mafatlal House, Backbay Reclamation Aayakar Bhavan, M.K. Road H.T. Parekh Marg, Mumbai - 400020 Mumbai - 400020 PAN: AAACM2813L (Appellant) (Respondent) ITA.NO. 4369/MUM/2013 (A.Y. 2008-09) M/s. Mafatlal Industries Limited v. Addl. CIT – 6(3) Kaledonia, Office No.3 Aayakar Bhavan, M.K. Road 6th Floor, Sahar Road Mumbai - 400020 Andheri (E), Mumbai - 400069 PAN: AAACM2…

M/s Nitesh Estates Private Limited vs. Deputy Commissioner of Income Tax

ITA/31/2015HC Karnataka22 Jul 2022

Bench: P.S.DINESH KUMAR,ANANT RAMANATH HEGDE

Section 260Section 37(1)

…lowed Revenue's appeal. On further appeal, the High Court upheld Tribunal's order. The Hon'ble Supreme Court of India, held that the money can be said to be advanced to a sister 7 (2007) 288 ITR 1 (SC) (para 34) I.T.A No.31/2015 13 concern for commercial expediency in many circumstances. 17. In CIT Vs. Dalmia Cement (Bharat) Ltd.8, it is held that once it is established that there is…

Proseed India Limited (Formerly Green Fire Agri Commodities Limited ), Hyderabad vs. ACIT, Circle-2(2), Hyderabad

In the result, appeal of the assessee is treated as allowed for statistical purpose

ITA 206/HYD/2015[2010-11]Status: DisposedITAT Hyderabad22 Jul 2022AY 2010-11

Bench: Shri Rama Kanta Panda & Shri K.Narasimha Chary

For Appellant: Shri P.V.S.S.Prasad, ARFor Respondent: Shri Y.V.S.T.Sai, CIT-DR
Section 115Section 143(3)Section 144C(13)Section 92Section 92C

…आयकर अपीलीय अिधकरण, हैदराबाद पीठ म" IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”, HYDERABAD BEFORE SHRI RAMA KANTA PANDA, ACCOUNTANT MEMBER & SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER आ.अपी.सं / ITA No. 206/Hyd/2015 (िनधा"रण वष" / Assessment Year: 2010-11) M/s.Proseed India Limited, Vs. Asst. Commissioner of (Formerly Green Fire Agri Income Tax, Commodities Limited), Circle-2(2), Hyderabad Hyderabad [PAN No. AABCN7753P] अपीलाथ" / Appellant "" यथ" / Respondent िनधा""रती "ारा / Assessee by: Shri P.V.S.S.Prasad, AR राज" व "ारा / Revenue by: Shri Y.V.S.T.Sai, CIT-DR सुनवाई की तारीख/Date of hearing:…

Addl . CIT, Special Range- 4, New Delhi vs. Gaursons Realty Pvt. Ltd., New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 2662/DEL/2019[2015-16]Status: DisposedITAT Delhi22 Jul 2022AY 2015-16

Bench: Shri Shamim Yahya & Ms. Astha Chandraassessment Year: 2015-16

For Appellant: Shri S. Krishanan, AdvocateFor Respondent: Shri Sanjay Gupta, CIT(DR)
Section 143(3)Section 194ISection 36Section 36(1)Section 36(1)(va)

…f Directors, and to decide how much is reasonable expenditure having regard to circumstances of case. In this regard, we may also note the ratio of the decision of the Supreme Court in S.A. Builders Ltd. vs. Commissioner of Income Tax (Appeals) and Anr.(2007) 288 ITR 1 (SC), wherein the Supreme Court held that the decisions relating to Section 37 of the Act will also be applicable to Section 36 (1) (iii) because in Section 37 also, the expression used is “for the purpose of business” and that while interpreting Section 37, “for the purpose of business” includes expenditure voluntarily incurred for commercial expe…

DCIT., Circle-2(1), Hyderabad vs. Ksk Energy Ventures Limited, Hyderabad

ITA 110/HYD/2015[2009-10]Status: DisposedITAT Hyderabad14 Jul 2022AY 2009-10

Bench: Shri Rama Kanta Panda & Shri K.Narasimha Chary

For Appellant: Shri S.Rama Rao, ARFor Respondent: Ms. M.Narmada, CIT-DR
Section 143(3)Section 35DSection 37(1)

…of the business, which business need not necessarily be the assessee’s own business, the relevant expenditure would ordinarily be entitled to deduction, and applied the law laid down by the Hon’ble Apex Court in the case of SA Builders Limited Vs. CIT (2007) 288 ITR 1 (SC) to allow the entire IPO issue expenses of Rs. 50,58,08,417/-. Revenue is challenging the same before us by placing reliance on the decisions reported in M/s Brooke Bond India Ltd vs. CIT Page 2 of 7 (1997) 91 taxman 26 (SC), M/s. Punjab State Industrial Development Corporation Ltd Vs. CIT 225 ITR 792 (SC) and CIT Vs. Kodak India Limited 253 I…

Wep Peripherals Ltd, Bangalore vs. Deputy Commissioner of Income Tax, Circle-7(1)(2), Bangalore

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

ITA 1905/BANG/2017[2012-13]Status: DisposedITAT Bangalore14 Jul 2022AY 2012-13

Bench: Shri Chandra Poojari & Smt. Beena Pillaiassessment Year: 2012 – 13

For Appellant: Shri K.R. Pradeep, A.R. &For Respondent: Shri Srinivas Rao Bandaru, D.R
Section 143(3)Section 2(22)(e)

…p only on account of business exigency. On this reason also, it cannot be considered as deemed dividend in terms of section 2(22)(e) of the Wep Peripherals Ltd., Bangalore Page 16 of 18 Act. Further, Hon’ble Supreme Court in the case of S.A. Builders Vs. CIT 288 ITR 1 (SC) , wherein it was held as follows:- “The Hon'ble Supreme Court in the case of "S.A.Builders Vs. CIT" (2007) 288 ITR 1 (SC) in the context of expenditure allowable u/s.37 of the Act has observed that what is to be seen as to whether the assessee advanced loan to its sister concern or a subsidiary as a measure of commercial expediency. The Hon'bl…

Premji Thaver Shah, Mumbai vs. CIT (A)-53, Mumbai

In the result, appeal of the assessee is allowed

ITA 235/MUM/2021[2014-15]Status: DisposedITAT Mumbai12 Jul 2022AY 2014-15
Section 143(3)Section 147Section 148

…nce, it was submitted by the ld. AR that the advance was made by the assessee to its sister concern during the course of its business. The ld. AR placed reliance on the decision of the Hon’ble Supreme Court in the case of SA Builders Ltd., vs. CIT reported in 288 ITR 1 among others. 3.2. It is a fact that assessee had advanced loans to its sister concern M/s. Symbolic Developers Ltd., wherein assessee is holding 45% voting share. The purpose of assessee advancing loans to the said sister concern has been elaborated above and the said fact has not been disputed by the Revenue. Hence, it could be safely concluded…

Devesh Cinemas, Faridabad vs. ITO Ward - 2(1), Faridabad

In the result, I.T.A. No. 6173/DEL/2019 is allowed

ITA 6184/DEL/2019[2015-16]Status: DisposedITAT Delhi12 Jul 2022AY 2015-16

Bench: Dr. B. R. R. Kumar & Sh. Yogesh Kumar U.S.

Section 143(3)Section 251Section 251(1)Section 56(2)(viib)Section 68

…annot guide a businessman in which manner risk has to be undertaken. Such an approach of the revenue has been judicially frowned by the Hon'ble Apex Court on several www.taxguru.in I.T.A. No.8113/DEL/2018 39 occasions, for instance in the case of SA Builders, 288 ITR 1 (SC) and CIT vs. Panipat Woollen and General Mills Company Ltd., 103 ITR 66 (SC). The Courts have held that Income Tax Department cannot sit in the armchair of businessman to decide what is profitable and how the business should be carried out. Commercial expediency has to be seen from the point of view of businessman. Here in this case if the inve…