Seth R. Dalmia v. CIT

110 ITR 644Supreme Court of India1977#2912 most cited

What is Seth R. Dalmia v. CIT authority for?

An indirect connection between expenditure and income can be sufficient to establish the required nexus for deductibility under Section 57(iii). The connection need not be direct.

40

judgments rely on this decision, according to BharatTax’s citation analysis of 367,854 Indian tax judgments — from 2016 to 2026.

Also referred to as

Seth R. Dalmia v. CIT · 110 ITR 644 · SC · 1977 · section 57(iii) · business expenditure · proximate nexus · indirect connection · earning of income · deductibility of expenditure

Sections most often in play

Section 57Section 144Section 143(3)Section 147Section 268ASection 234BSection 234DSection 251

Issues it is cited on

section 57(iii)proximate nexusright to receivesection 57section 268asection 142(2)audi alteram partemsection 254section 220revision u/s 263section 234ddisallowance of interest expenditure

Judgments citing Seth R. Dalmia v. CIT

Smt. Jyoti H Mehta, Mumbai vs. ACIT, CC-4(1), Mumbai

ITA 436/MUM/2023[1993-94]Status: DisposedITAT Mumbai27 Oct 2023AY 1993-94

Bench: Shri Amit Shukla & Shri Gagan Goyaljyoti H. Mehta 32, Madhuli Apartment, 3Rd Floor, Dr. A. B. Road, Worli, Mumbai-400 018 Pan: Abnpm8233B ..... Appellant Vs. Acit Circle 4(1) R. No. 1916, 19Th Floor, Air India Building, Nariman Point, Mumbai-400021 Mumbai ..... Respondent

For Appellant: Shri Vijay MehtaFor Respondent: Dr. P. Daniel, Spl. Counsel
Section 234ASection 250Section 57

…e mere fact that income by way of dividend has accrued and that the expenditure incurred is in some manner or other related to the accrual of the dividend income is not sufficient.” 31. We find that the Hon’ble Supreme Court in Seth R. Dalmia v/s CIT, [1977] 110 ITR 644 (SC) agreed with the view taken by the Hon’ble jurisdictional High Court in CIT v/s H.H. Maharani Vijaykuverba Saheb of Morvi [1975] 100 ITR 67 (Bom), wherein it was held that the connection between the expenditure and the earning of income need not be direct, and even an indirect connection could prove the nexus between the expenditure incurred…

Pratima Hitesh Mehta, Mumbai vs. DCIT, CC-4(1), Mumbai

In the result, the present cross-appeals are partly allowed for statistical purposes

ITA 416/MUM/2023[1992-93]Status: DisposedITAT Mumbai26 Oct 2023AY 1992-93

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

For Appellant: Shri Dharmesh Shah a/wFor Respondent: Dr. P. Daniel
Section 133(6)Section 142(1)Section 144Section 145(2)Section 250Section 254

…e mere fact that income by way of dividend has accrued and that the expenditure incurred is in some manner or other related to the accrual of the dividend income is not sufficient.” 31. We find that the Hon’ble Supreme Court in Seth R. Dalmia v/s CIT, [1977] 110 ITR 644 (SC) agreed with the view taken by the Hon’ble jurisdictional High Court in CIT v/s H.H. Maharani Vijaykuverba Saheb of Morvi [1975] 100 ITR 67 (Bom), wherein it was held that the connection between the expenditure and the earning of income need not be direct, and even an indirect connection could prove the nexus between the expenditure incurred…

Dy Commissioner of Income Tax, Cent -Circle-4(1), Mumbai vs. Smt Pratima H. Mehta, Mumbai

In the result, the present cross-appeals are partly allowed for statistical purposes

ITA 1180/MUM/2023[1992-93]Status: DisposedITAT Mumbai26 Oct 2023AY 1992-93

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

For Appellant: Shri Dharmesh Shah a/wFor Respondent: Dr. P. Daniel
Section 133(6)Section 142(1)Section 144Section 145(2)Section 250Section 254

…e mere fact that income by way of dividend has accrued and that the expenditure incurred is in some manner or other related to the accrual of the dividend income is not sufficient.” 31. We find that the Hon’ble Supreme Court in Seth R. Dalmia v/s CIT, [1977] 110 ITR 644 (SC) agreed with the view taken by the Hon’ble jurisdictional High Court in CIT v/s H.H. Maharani Vijaykuverba Saheb of Morvi [1975] 100 ITR 67 (Bom), wherein it was held that the connection between the expenditure and the earning of income need not be direct, and even an indirect connection could prove the nexus between the expenditure incurred…

DCIT vs. M/S Fiza Developers & Infrastructer Pvt. Ltd

In the result, all the miscellaneous petitions are allowed

ITA 985/BANG/2013[2007-08]Status: DisposedITAT Bangalore13 May 2022AY 2007-08

Bench: Shri Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri T.N. Prakash, Addl.CIT(DR)(ITAT), Bengaluru
Section 263Section 54FSection 57

…ection 12(2). But, that is not the position in the present. In my view the true ratio of this case far from supporting the case of the petitioner, supports the case of the revenue. MP Nos. 18 to 20/Bang/2022 Page 10 of 13 14. In Seth R. Dalmia v. CIT [1977] 110 ITR 644, the Supreme Court was again dealing with a case under section 12(2) on expenditure incurred in the acquisition of shares by the assessee as such. Even the principles enunciated in this case that reiterate the principles enunciated in Eastern Investments Ltd.'s case (supra) do not support the case of the petitioner. The numerous other cases of ot…

Goel Ganga Construction, Pune vs. Income-Tax Officer, Ward - 7(3), Pune

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

ITA 2138/PUN/2017[2008-09]Status: DisposedITAT Pune11 Mar 2022AY 2008-09
For Appellant: Shri Rajiv ThakkarFor Respondent: Shri M. Jasnani
Section 139Section 143(3)Section 147Section 148Section 80I

…osition of law that for the purpose of allowing the 10 expenditure against the interest income earned, the loans should be borrowed for the purpose of earning the interest income as laid down by the Hon’ble Supreme Court in the case of Seth R. Dalmia vs. CIT, 110 ITR 644 (SC). The falsity of the claim was exposed by the audit party. Therefore, the assessee cannot claim that there was no failure on the part of the assessee to disclose truly and fully all material facts necessary for the purpose of making the assessment. The reliance placed by the ld. Counsel for the assessee on the decision of the Hon’ble Bombay H…

Arjun M Ranga, Mysuru vs. Principal Commissioner of Income Tax (Central), Bengaluru

In the result, the appeal of the assessee is dismissed

ITA 692/BANG/2021[2016-17]Status: DisposedITAT Bangalore14 Feb 2022AY 2016-17

Bench: Shri Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri Sumer Singh Meena, CIT(DR)(ITAT), Bengaluru
Section 143Section 263Section 54FSection 57

…preme Court found that the case attracted section 12(2). But, that is not the position in the present. In my view the true ratio of this case far from supporting the case of the petitioner, supports the case of the revenue. 14. In Seth R. Dalmia v. CIT [1977] 110 ITR 644, the Supreme Court was again dealing with a case under section 12(2) on expenditure incurred in the acquisition of shares by the assessee as such. Even the principles enunciated in this case that reiterate the principles enunciated in Eastern Investments Ltd.'s case (supra) do not support the case of the petitioner. The numerous other cases of ot…

Guru Pavan Ranga, Mysuru vs. Principal Commissioner of Income Tax, (Central), Bangalore

In the result, both the appeals of the assessees are dismissed

ITA 677/BANG/2021[2016-17]Status: DisposedITAT Bangalore14 Feb 2022AY 2016-17

Bench: Shri Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri Sumer Singh Meena, CIT(DR)(ITAT), Bengaluru
Section 143Section 263Section 54FSection 57

…preme Court found that the case attracted section 12(2). But, that is not the position in the present. In my view the true ratio of this case far from supporting the case of the petitioner, supports the case of the revenue. 14. In Seth R. Dalmia v. CIT [1977] 110 ITR 644, the Supreme Court was again dealing with a case under section 12(2) on expenditure incurred in the acquisition of shares by the assessee as such. Even the principles enunciated in this case that reiterate the principles enunciated in Eastern Investments Ltd.'s case (supra) do not support the case of the petitioner. The numerous other cases of ot…

Anirudh Murthy Ranga, Mysuru vs. Principal Commissioner of Income Tax, (Central), Bengaluru

In the result, both the appeals of the assessees are dismissed

ITA 676/BANG/2021[2016-17]Status: DisposedITAT Bangalore14 Feb 2022AY 2016-17

Bench: Shri Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri Sumer Singh Meena, CIT(DR)(ITAT), Bengaluru
Section 143Section 263Section 54FSection 57

…preme Court found that the case attracted section 12(2). But, that is not the position in the present. In my view the true ratio of this case far from supporting the case of the petitioner, supports the case of the revenue. 14. In Seth R. Dalmia v. CIT [1977] 110 ITR 644, the Supreme Court was again dealing with a case under section 12(2) on expenditure incurred in the acquisition of shares by the assessee as such. Even the principles enunciated in this case that reiterate the principles enunciated in Eastern Investments Ltd.'s case (supra) do not support the case of the petitioner. The numerous other cases of ot…

West Palm Developments LLP vs. Assistant Commissioner of

In the result, the order dated 14

ITA/598/2016HC Karnataka19 Nov 2021

Bench: ALOK ARADHE,ANANT RAMANATH HEGDE

Section 260Section 260ASection 36(1)(iii)Section 37Section 57

…1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 19TH DAY OF NOVEMBER 2021 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR. JUSTICE ANANT RAMANATH HEGDE I.T.A. NO.598 OF 2016 BETWEEN: WEST PALM DEVELOPMENTS LLP (FORMERLY WEST PALM DEVELOPMENTS PVT. LTD.) NO.1, THE FALCON HOUSE MAIN GUARD CROSS ROAD BANGALORE - 560001 REPRESENTED HEREIN BY ITS AUTHORISED SIGNATORY MR. V.V.B.S. SARMA. ... APPELLANT (BY SRI. T. SURYANARAYANA, ADV.,) AND: 1. ASSISTANT COMMISSIONER OF INCOME TAX - CIRCLE 7(1) (2) (ERST WHILE JOINT COMMISSIONER OF INCOME TAX (OSD) CIRCLE 12(5)…

Shri Rameshwar Lal Samdani, Bhilwara vs. ITO, Bhilwara

In the result, the appeal of the assessee is allowed

ITA 264/JODH/2017[2013-14]Status: DisposedITAT Jodhpur28 Jan 2021AY 2013-14

Bench: Shri Sandeep Gosain & Shri Manoj Kumar Aggarwalshri Rameshwar Lal Samdani, Vs. I.T.O., D-43, Shastri Nagar, Bhilwara Ward-3, (Raj)-311001. Bhilwara. Pan No. Adqps 6311 K Assessee By Shri Ajay Moondra Revenue By Shri K.C. Badhok, Cit-Dr Date Of Hearing 03.11.2020 Date Of Pronouncement 29/01/2021

Section 143(3)Section 56Section 57

…pon assessee on the basis of assumption & presumption. Further in support of above submission reliance is placed on the decision of Hon'ble Supreme Court in the case of S.A. Builders Limited v/s CIT reported in 288 ITR 0001, Seth R. Dalmia Vs. CIT reported in 110 ITR 644 (SC) and CIT v/s Rajendra Prasad Moody, 115 ITR 0519 (SC) and Eastern Investments Ltd. v/s CIT reported in 20 ITR 1, 4 (SC). The Hon'ble Supreme Court in the case of S.A. Builders v/s CIT reported in 288 ITR 0001. The Hon'ble High Court held as under: - "16. We have considered the submissions of the respective parties. The question involved in t…

M/S Best Trading & Agencies Ltd vs. The Deputy Commissioner of Income Tax

In the result, the orders passed by the

ITA/32/2012HC Karnataka26 Aug 2020

Bench: ALOK ARADHE,H.T. NARENDRA PRASAD

Section 115JSection 260Section 260A

…2000 decided on 14.09.2011. In support of aforesaid submissions, reliance has been placed on decisions in ‘COMMISSIONER OF INCOME TAX VS. SHOORJI VALLABH DAS AND CO.’, (1962) 46 ITR 144 (SC), ‘SETH R. DALMIA VS. COMMISSIONER OF INCOME TAX’, (1977) 110 ITR 644 (SC), ‘COMMISSIONER OF INCOME TAX VS. RAJENDRA PRASAD MOODY’, (1978) 115 ITR 519, order of the Income Tax Appellate Tribunal dated 20.05.2005 passed in ‘MSR & 12 SONS INVESTMENTS LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX’, ‘COMMISSIONER OF INCOME TAX VS. LAKSHMI MACHINE WORKS’, (2007) 290 ITR 667 (SC), ‘TOt gars COOPERA…

M/S Best Trading & Agencies Ltd vs. The Deputy Commissioner of Income Tax

In the result, the orders passed by the

ITA/191/2011HC Karnataka26 Aug 2020

Bench: ALOK ARADHE,H.T. NARENDRA PRASAD

Section 115JSection 260Section 260A

…2000 decided on 14.09.2011. In support of aforesaid submissions, reliance has been placed on decisions in ‘COMMISSIONER OF INCOME TAX VS. SHOORJI VALLABH DAS AND CO.’, (1962) 46 ITR 144 (SC), ‘SETH R. DALMIA VS. COMMISSIONER OF INCOME TAX’, (1977) 110 ITR 644 (SC), ‘COMMISSIONER OF INCOME TAX VS. RAJENDRA PRASAD MOODY’, (1978) 115 ITR 519, order of the Income Tax Appellate Tribunal dated 20.05.2005 passed in ‘MSR & 12 SONS INVESTMENTS LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX’, ‘COMMISSIONER OF INCOME TAX VS. LAKSHMI MACHINE WORKS’, (2007) 290 ITR 667 (SC), ‘TOt gars COOPERA…

Smt. Shanti Devi Merwah, New Delhi vs. ACIT, New Delhi

In the result, all appeals filed by the assessee are allowed

ITA 267/DEL/2015[2006-07]Status: DisposedITAT Delhi21 May 2020AY 2006-07

Bench: Ms. Sushma Chowla, V.P & Shri Prashant Maharishi, Am आयकर अपील सं. / Ita Nos.267 To 270/Del/2015 "नधा"रण वष" / Assessment Years 2006-07 To 2009-10 Mr. Chander Mohan Merwah, L/H & Registered Representative Of Late Smt. Shanti Devi Merwah, Flat No.14A, Tower No.19, Dcentral Park-2, Sohna Raod, Scetor-48, Gurgaon, Haryana-122018. ..........अपीलाथ"/Appellant Pan-Aajpd8788R Vs The Acit, Central Circle-12, …………. ""यथ" / Respondent New Delhi.

For Appellant: Sh. Sandeep Ahuja, CAFor Respondent: Sh. H.K.Choudhary, CIT DR
Section 153ASection 234BSection 281B

…s of the assessee. (iv) The expenditure should be incurred in the accounting year. (v) There must be a clear nexus between the expenditure incurred and the income sought to be earned.” 13. The Hon’ble Supreme Court in the case of Seth R.Dalmia vs CIT [1977] 110 ITR 644 (SC) was held that “for allowability of such deduction, the dominant purpose of the expenditure incurred must be to earn income. The connection between the expenditure and the earning of income need not be direct; even an indirect connection could prove the nexus between the expenditure incurred and the income.” The claim of the assessee has be…

Shri Rashmin Ramniklal Vora, Ahmedabad vs. The Income Tax Officer, Ward-1(2)(5), Ahmedabad

In the result, the appeal of the assessee is dismissed

ITA 1066/AHD/2017[2013-14]Status: DisposedITAT Ahmedabad18 Jun 2019AY 2013-14
For Appellant: Shreekant S. Shah, A.RFor Respondent: Shri Virendra Singh, Sr. D.R
Section 143(2)Section 143(3)Section 57

…or earned of income. Section 57(iii) does not require that purpose must be fulfilled in order to qualify the expenditure for deduction.” 6. The Commissioner (Appeals) ought to have followed the ratio of Apex Court in the case of Sheth R. Dalmia v/s CIT (1977) 110 ITR 644 laying down that the dominant purpose of the expenditure incurred must be to earn income. The connection between the expenditure and the earning of income need not be direct even on indirect connection should prove the nexus between the expenditure incurred and the income. 7. The Commissioner (Appeals) erred in observing that interest paid is a c…

Patel Goyal Associates, Pune vs. Income-Tax Officer

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

ITA 132/PUN/2016[2008-09]Status: DisposedITAT Pune20 Mar 2019AY 2008-09

Bench: Ms. Sushma Chowla, Jm & Shri D. Karunakara Rao, Am आयकर अपील सं. / Ita No.132/Pun/2016 िनधा"रण वष" / Assessment Year : 2008-09 Patel Goyal Associates, 501, Fortune House, Prabhat Road, Erandwane, Pune-411004. अपीलाथ"/Appellant Pan : Aahfp0519N …. Vs. Ito, Judicial (Hq), …. ""यथ" / Respondent Pune. अपीलाथ" क" ओर से / Appellant By : Shri Nikhil Pathak & Shri Kailash Agarwal ""थ" की ओर से / Respondent By : Shri Sanjeev Ghai सुनवाई क" तारीख / घोषणा क" तारीख / Date Of Hearing : 24.01.2019 Date Of Pronouncement: 20.03.2019 आदेश / Order Per D. Karunakara Rao, Am : This Appeal Is Filed By The Assessee Against The Order Of Cit(A)-3, Pune Dated 24.11.2015 For The Assessment Year 2008-09. 2. The Grounds Raised By The Assessee Are As Under :- “1. Disallowance Of Interest Of Rs.29,65,196/- U/S 57(Iii) In The Facts & Circumstances Of The Case The Learned Cit(A) Erred In Confirming The Disallowance Of Interest U/S 57(Iii). 2. In The Facts & Circumstances Of The Case, Interest Paid Ought To Have Been Allowed U/S 57(Iii). For That Learned Cit(A) Failed To Appreciate That When The Learned A.O. Has Recorded A Clear Cut Finding In The Assessment Order & Affirmed The Position Taken By The Appellant In Return Of Income That When Interest Is Not Claimed & Also Not Allowable U/S 36(1)(Iii), It Has To Be Allowed U/S 57(Iii). 3. For That In The Facts & Circumstances Of The Case, The Learned Cit(A) Failed To Appreciate The Fact That When Borrowed Funds Were Not Required For Business Purposes Due To Availability Of Surplus Funds In Regular Business, Interest Is Paid Only To Earn Interest Income & Hence Interest Cannot Be Disallowed U/S 57(Iii).

For Appellant: Shri Nikhil Pathak &For Respondent: Shri Sanjeev Ghai
Section 143(3)Section 263Section 36(1)(iii)Section 57Section 80I

…n incurred solely and exclusively for the purpose of earning or making income and there must be a clear nexus between the expenditure incurred and income sought to be earned. These conditions emerge from the decisions rendered in Seth R. Dalmia Vs. CIT (1977) 110 ITR 644 (SC) and the Bombay High Court decision in the case of Smt. Zubedabai Vs. CIT (1984) 148 ITR 104 (Bom), among others. Thus, it is the purpose of the expenditure that is relevant in determining the applicability u/s. 57(iii) which is making or earning of income. The appellant has not been able to justify its claim of having established the nexus o…

ITO-2(2)(1), Mumbai vs. Innovative Insurance Services Pvt. Ltd., Mumbai

In the result, the appeal filed by the revenue is hereby ordered to be dismissed

ITA 2821/MUM/2016[2012-13]Status: DisposedITAT Mumbai07 Mar 2018AY 2012-13

Bench: Shri G. S. Pannu, Am & Shri Amarjit Singh, Jm आयकर अपील सं/ I.T.A. No.2821/Mum/2016 (निर्धारण वर्ा / Assessment Year: 2012-13) Ito-2(2)(1) बिधम/ Innovative Insurance Service Room No.549, 5Th Floor, P. Ltd., Manek Mahal, 6Th Vs. Aayakar Bhavan, M.K. Floor, 90, Veer Nariman Road, Churchgate, Mumbai- Road, Mumbai-400020. 400020. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aagcs9243N (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) Revenue By: Shri Rajesh Kumar Yadav (Dr) Assessee By: Shri Jitendra Sanghavi & Amit Khatiwala (Ar) सुनवाई की तारीख / Date Of Hearing: 19.12.2017 घोषणा की तारीख /Date Of Pronouncement: 07.03.2018 आदेश / O R D E R Per Amarjit Singh, Jm: The Revenue Has Filed The Present Appeal Against The Order Dated 22.01.2016 Passed By The Commissioner Of Income Tax (Appeals)-5 Mumbai [Hereinafter Referred To As The “Cit(A)”] Relevant To The Ay.2012-13. 2. The Revenue Has Raised The Following Grounds: - 1. The Order Of The Cit(A) Is Opposed To Law & Facts Of The Case. 2. On The Facts & In The Circumstances Of The Case & In Law, The Ld. Cit(A) Has Erred In Allowing The Interest Expenditure Of

For Appellant: Shri Jitendra Sanghavi & AmitFor Respondent: Shri Rajesh Kumar Yadav (DR)
Section 142(1)Section 143(1)Section 143(2)

…t was shown as income from other sources. The interest was paid on loans obtained /or making these investments ITA. No. 2821M/2016 A.Y. 2012-13 in shares and relying upon the judgement of the Hon’ble Supreme Court in the case of Seth R Dalmia Vs. CIT [1977) 110 ITR 644 where if was held that the nexus between the expenditure and the income need not be direct and even on indirect connection could prove the nexus between the expenditure incurred and the income earned, he held that the expenditure be deductible. He further held that the quantum of the dividend earned had nothing to do with the quantum of interest…

Ashok Amritraj, Chennai vs. ITO, Chennai

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1244/CHNY/2017[2014-15]Status: DisposedITAT Chennai20 Feb 2018AY 2014-15

Bench: Shri A. Mohan Alankamony & Shri Duvvuru Rl Reddyआयकर अपील सं./I.T.A.No.1244/Mds/2017 "नधा"रण वष"/Assessment Year:2014-15 Shri Ashok Amritraj, The Income Tax Officer, Flat No. 10, Chesney Lane, Vs. International Taxation 1(1), Ethiraj Salai, Egmore, Chennai 34. Chennai 600 008. [Pan: Aabpa2975R] (अपीलाथ" /Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से / Appellant By : Shri K. Balasubramanian, Advocate ""यथ" क" ओर से/Respondent By : Shri S. Mohd. Mustafa, Jcit सुनवाई क" तार"ख/ Date Of Hearing : 29.01.2018 घोषणा क" तार"ख /Date Of Pronouncement : 20.02.2018 आदेश /O R D E R Per Duvvuru Rl Reddy:

For Appellant: Shri K. Balasubramanian, AdvocateFor Respondent: Shri S. Mohd. Mustafa, JCIT
Section 142(1)Section 143(2)Section 57

…of deduction of an expenditure under section 57(iii) of the Act after analysing the statutory language and principles laid down by the Hon’ble Supreme Court in the case of Eastern Investments Ltd. vs. CIT (1951) 20 ITR 1 (SC) and Seth R. Dalmia vs. CIT (1977) 110 ITR 644 (SC) : (i) in order to decide whether an expenditure is a permissible deduction under section 57(iii) of the Act, the nature of the expenditure must be examined. (ii) the expenditure must not be in the nature of capital expenditure or personal expenses of the assessee; (iii) the expenditure must have been laid out or expended wholly and exclusive…

Harman Harjaspal Singh Baweja, Mumbai vs. Income Tax Officer Ward-11(1)(2), Mumbai

In the result, this appeal by the assessee appeal by the assessee stands

ITA 5641/MUM/2017[2011-12]Status: DisposedITAT Mumbai05 Feb 2018AY 2011-12

Bench: Shri Shamim Yahyaassessment Year : 2011-12

For Appellant: Shri R C JainFor Respondent: Ms N Hemalatha
Section 57Section 57(1)

…om DHFL @14.5% p.a whereas such loan has been lent to related concern on interest @6.53% hence, corresponding interest expenditure is to be allowed. In support of this contention, Assessing Officer has placed his reliance in cases of : • Seth R Dalmia vs. CIT 110 ITR 644 (SC) • CIT vs. Dr V P Gopinathan 248 ITR 449 (SC) • Omerods (India) Pvt Ltd. vs. CIT 36 ITR 329 (Bom) Thus, according to Assessing Officer, assessee has obtained loan at higher rate of interest but has diverted it to related concern at lower rate of interest which is against principle enunciated by Supreme Court for allowability of expenditure u/…

The Commissoner of Income Tax I vs. M/s. Alpha Thought Technologies P Ltd

ITTA/191/2011HC Telangana21 Mar 2016

Bench: RAMESH RANGANATHAN,M.SATYANARAYANA MURTHY

Jiten P. Mathuria, Mumbai vs. ACIT 25(3), Mumbai

In the result appeal of the assessee is allowed

ITA 327/MUM/2014[2009-10]Status: DisposedITAT Mumbai06 Jan 2016AY 2009-10

Bench: Shri Amit Shukla & Shri Rajesh Kumarassessment Year: - 2009-10 Shri Jiten P. Mathuria Vs.` Acit – 25(3), Mumbai, 1702-4, Panchaseel Heights, C-11, 3Rd Floor, Mahavir Nagar, Bandra Kurla Complex, Kandivali (W) Bandra (East) Mumbai – 400 067. Mumbai – 400 051. Pan/Gir No. Aobps7066K Appellant Respondent

Section 143(3)Section 57

…your appellant’s case and hence is not applicable. 1.3 On the facts and circumstances of the case an in law the learned Commissioner Of Income Tax (Appeals) erred in failing to appreciate that the Hon. Supreme Court in the case of Seth R. Dalmia v. CIT(1977) 110 ITR 644 has held that the nexus between the expenditure incurred and the income earned need not be direct and even an indirect connection could prove the nexus between the expenditure incurred and the income earned. He ought to have followed this decision and allowed the appeal. 1.4 On the facts and circumstances of the case an in law the learned Commiss…

Seth R. Dalmia v. CIT (110 ITR 644) — Cited in 40 Judgments | BharatTax