Sarabhai Sons (P.) Ltd. v. CIT

201 ITR 464High Court1993#11279 most cited
9

judgments rely on this decision, according to BharatTax’s citation analysis of 292,668 Indian tax judgments — from 2017 to 2025.

Sections most often in play

Section 1961Section 1962Section 24Section 37(1)Section 57(iii)Section 57(iii) of the Income Tax Act

Judgments citing Sarabhai Sons (P.) Ltd. v. CIT

NITIN MADANLAL KHANDELWAL,AKOLA vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE - AKOLA, AKOLA

In the result, appeal filed by the assessee stands dismissed

ITA 55/NAG/2024[2014-15]Status: DisposedITAT Nagpur14 Feb 2025AY 2014-15

Bench: Shri V. Durga Rao & Shri K.M. Roy, Accountant, Member

For Appellant: Shri Shubham JainFor Respondent: Shri Abhay Y. Marathe
Section 57

…TR 653 has held that in order to decide whether an expenditure is a permissible deduction under section 57(iii), the nature of the expenditure must be examined. Also the Gujarat High Court in the case of Sarabhai Sons (P) Ltd. vs. CIT (1993) 113 Taxation 407, 201 ITR 464 has held that if the dominate purpose for which the expenditure was incurred not to be earn the income, the expenditure incurred in that behalf would fall outside the purview of section 57(iii) of the Act. Where the dominant purpose of the assessee in taking overdrafts was not to earn income but to meet the personal liability, interest payment on…

RAJ KUMAR KANDOI,JAIPUR vs. ACIT CENTRAL CIRCLE 3, JAIPUR, JAIPUR

In the result, the appeal of the assessee stands allowed with no orders as to costs

ITA 575/JPR/2024[2017-18]Status: DisposedITAT Jaipur10 Jul 2024AY 2017-18
For Appellant: Shri S.L. Poddar, AdvocateFor Respondent: Shri Rajesh Kumar Meena, Addl. CIT-DR
Section 57

…TR 653 has held that in order to decide whether an expenditure is a permissible deduction under section 57(iii), the nature of the expenditure must be examined. Also the Gujarat High Court in the case of Sarabhai Sons (P) Ltd. vs. CIT (1993) 113 Taxation 407, 201 ITR 464 has held that if the dominate purpose for which the expenditure was incurred not to be earn the income, the expenditure incurred in that behalf would fall outside the purview of section 57(iii) of the Act. Where the dominant purpose of the assessee in taking overdrafts was not to earn income but to meet the personal liability, interest payment on…

M/S. BITWISE SOLUTIONS PVT. LTD.,,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX,, PUNE

In the result, appeal of the assessee is Partly Allowed

ITA 756/PUN/2017[2011-12]Status: DisposedITAT Pune29 Apr 2022AY 2011-12

Bench: Shri Satbeer Singh Godara, Jm & Dr. Dipak P. Ripote, Am आयकरअपीलसं. / Ita No.756/Pun/2017 िनधा"रणवष" / Assessment Year : 2011-12 Bitwise Solutions Pvt. Ltd., The Dcit, Circle-1(1), Pune. Bitwise World, Off International Vs Convention Centre, Shivaji Nagar, Senapati Bapat Road, Pune – 411 016. Pan: Aaacb 4239 K Appellant/ Revenue Respondent/ Assessee Assessee By Shri Kishor B Phadke – Ar Revenue By Shri S P Walimbe - Dr Date Of Hearing 27/04/2022 Date Of Pronouncement 29/04/2022 आदेश/ Order Per Dr. Dipak P. Ripote, Am: This Appeal Filed By The Assessee Is Directed Against The Order Of Ld.Commissioner Of Income Tax(Appeals)-1, Pune, Dated 15.12.2016 For The Assessment Year 2011-12.The Assessee Raised The Following Grounds Of Appeal: “1. The Learned Cit(A)-1, Pune Erred In Law & On Facts In Sustaining The Addition U/S.36(1)(Iii) Of The Ita, 1961 Of Rs.69,51,455/- Made By Learned Dcit, Circle-1(1), Pune(Hereinafter Referred To As The Learned Ao). 2. The Learned Cit(A)-1 & The Learned Ao Erred In Law & On Facts In Not Appreciating That, Share Purchase Transaction For Which Loan Was Availed Was A Business Transaction I.E. After Buying Shares, Bitwise Inc., Usa, Became 100% Subsidiary Of The Appellant Company. 3. The Learned Cit(A)-1 & The Learned Ao Further Erred In Law & On Facts In Not Appreciating That Appellant Company Benefitted From Share Purchase Transaction In Terms Of Direct Control Over Bitwise Inc., Usa & Assurance As To Getting Business In Future Years.

Section 36Section 36(1)(iii)Section 57

…order is as under: “In support of revenue’s case reliance is placed on the judgment of Jurisdictional High Court in the case of CIT v. Amritaben R. Shah [1998] 238 ITR 777 1 (Bom.) and of Gujarat High Court in the case of Sarabhai Sons (P.) Ltd. v. CIT [1993] 201 ITR 464 in which it has been held that interest on loan taken for purchasing shares for acquiring controlling interest in the company cannot be held to be expenditure incurred wholly and exclusively for earning income from dividend and deduction under section 57(iii) is not allowable. Though, the judgment has been rendered in context of section 57, the b…

SH. RAVINANDAN KUMAR,LUDHIANA vs. ACIT, C-7, LUDHIANA

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

ITA 21/CHANDI/2019[2014-15]Status: DisposedITAT Chandigarh14 Jun 2021AY 2014-15
For Appellant: Shri Parikshit Aggarwal, CAFor Respondent: Shri Ashok Khanna, Addl.CIT
Section 143(3)Section 250(6)Section 57

…ITR 653 has held that in order to decide whether an expenditure is a permissible deduction under section 57(iii), the nature of the expenditure must be examined. Also the Gujarat High Court in the case of Sarabhai Sons (P) Ltd. vs. CIT(1993) 113 Taxation 407, 201 ITR 464 has held that if the dominate purpose for which the expenditure was incurred not to be earn the income, the expenditure incurred in that behalf would fall outside the purview of section 57(iii) of the Act. Where the dominant purpose of the assessee in taking overdrafts was not to earn income but to meet the personal liability, interest payment on…

ACIT, NEW DELHI vs. M/S. LODHI PROPERTY COMPANY LTD., NEW DELHI

In the result, appeal of the assessee is allowed and the appeal of the revenue is dismissed

ITA 4970/DEL/2011[2007-08]Status: DisposedITAT Delhi26 Feb 2018AY 2007-08

Bench: Shri G.D. Agrawal, Hon’Ble & Shri K.Narasimha Charylodhi Property Company Ltd. Vs Dcit C/O Authorized Representative Sr Circle 4(1) Batliboi & Co., Golf View New Delhi. Corporate Tower-B, Sector 42, Sector Road, Gurgaon. Aabch0299N & Dcit Vs Lodhi Property Company Ltd. Circle 4(1) C/O Authorized Representative Sr Batliboi & New Delhi. Co., Golf View Corporate Tower-B, Sector 42, Sector Road, Gurgaon. Aabch0299N Assessee By Sh. R.S. Singhvi, Ca Sh. Satyajeet Goel, Ca Revenue By Sh. Ravi Kant Gupta, Sr. Dr

Section 35Section 36Section 37(1)

…al was used for business purpose and consequently interest on the borrowed amount is not deductible u/s 36(1)(iii) of the Act. 10. Learned CIT(A) placed reliance on the decision of Hon’ble Gujarat High Court in the case of Sarabhai Sons P. Ltd. vs CIT (1993) 201 ITR 464 wherein it was held that when the shares which are acquired not for the purpose of earning of income but only for the of the assessee and was not allowable. Ld.CIT(A) turned down the alternative plea of the assessee that the interest expense of Rs.6,04,24,392/- should be allowed as part of cost of shares in the year of sale of shares of GGGRL by…

LODHI PROPERTY COMPANY LTD.,GURGAON vs. DCIT, NEW DELHI

In the result, appeal of the assessee is allowed and the appeal of the revenue is dismissed

ITA 4851/DEL/2011[2007-08]Status: DisposedITAT Delhi26 Feb 2018AY 2007-08

Bench: Shri G.D. Agrawal, Hon’Ble & Shri K.Narasimha Charylodhi Property Company Ltd. Vs Dcit C/O Authorized Representative Sr Circle 4(1) Batliboi & Co., Golf View New Delhi. Corporate Tower-B, Sector 42, Sector Road, Gurgaon. Aabch0299N & Dcit Vs Lodhi Property Company Ltd. Circle 4(1) C/O Authorized Representative Sr Batliboi & New Delhi. Co., Golf View Corporate Tower-B, Sector 42, Sector Road, Gurgaon. Aabch0299N Assessee By Sh. R.S. Singhvi, Ca Sh. Satyajeet Goel, Ca Revenue By Sh. Ravi Kant Gupta, Sr. Dr

Section 35Section 36Section 37(1)

…al was used for business purpose and consequently interest on the borrowed amount is not deductible u/s 36(1)(iii) of the Act. 10. Learned CIT(A) placed reliance on the decision of Hon’ble Gujarat High Court in the case of Sarabhai Sons P. Ltd. vs CIT (1993) 201 ITR 464 wherein it was held that when the shares which are acquired not for the purpose of earning of income but only for the of the assessee and was not allowable. Ld.CIT(A) turned down the alternative plea of the assessee that the interest expense of Rs.6,04,24,392/- should be allowed as part of cost of shares in the year of sale of shares of GGGRL by…

COMMISSIONER OF INCOME TAX vs. M/S VIRAT INVESTMENT AND MERCA

ITA/37/2005HC Delhi19 Jan 2017

Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MR. JUSTICE NAJMI WAZIRI

Section 143Section 57

…tention essentially is reflected in Amritaben R. Shah (supra) in the following submission of law by the Bombay High Court: - “3. We are supported in our opinion by the decision of the Gujarat High Court in the case of Sarabhai Sons (P.) Ltd v. CIT [1993] 201 ITR 464. In that case, it was held that if the dominant purpose for which the expenditure was incurred was not to earn the income, the expenditure incurred in that behalf ITA Nos.709/2004, 37/2005 & 636/2004 Page 7 of 9 would fall outside the purview of Section 57(iii) of the Act. We are also supported in our above conclusion by the decision…

COMMISSIONER OF INCOME TAX VI vs. M/S VIRAT INVESTMENT & MERCANT

ITA/636/2004HC Delhi19 Jan 2017

Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MR. JUSTICE NAJMI WAZIRI

Section 143Section 57

…tention essentially is reflected in Amritaben R. Shah (supra) in the following submission of law by the Bombay High Court: - “3. We are supported in our opinion by the decision of the Gujarat High Court in the case of Sarabhai Sons (P.) Ltd v. CIT [1993] 201 ITR 464. In that case, it was held that if the dominant purpose for which the expenditure was incurred was not to earn the income, the expenditure incurred in that behalf ITA Nos.709/2004, 37/2005 & 636/2004 Page 7 of 9 would fall outside the purview of Section 57(iii) of the Act. We are also supported in our above conclusion by the decision…

COMMISSIONER OF INCOME TAX VI vs. M/S VIRAT INVESTMENT & MERCANT

ITA/709/2004HC Delhi19 Jan 2017

Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MR. JUSTICE NAJMI WAZIRI

Section 143Section 57

…tention essentially is reflected in Amritaben R. Shah (supra) in the following submission of law by the Bombay High Court: - “3. We are supported in our opinion by the decision of the Gujarat High Court in the case of Sarabhai Sons (P.) Ltd v. CIT [1993] 201 ITR 464. In that case, it was held that if the dominant purpose for which the expenditure was incurred was not to earn the income, the expenditure incurred in that behalf ITA Nos.709/2004, 37/2005 & 636/2004 Page 7 of 9 would fall outside the purview of Section 57(iii) of the Act. We are also supported in our above conclusion by the decision…

Sarabhai Sons (P.) Ltd. v. CIT (201 ITR 464) — Cited in 9 Judgments | BharatTax