Sutlej Cotton Mills Ltd. v. CIT

116 ITR 1Supreme Court of India1979#177 most cited

What is Sutlej Cotton Mills Ltd. v. CIT authority for?

A gain arising from the cancellation of a forward exchange contract entered into for the acquisition of a capital asset constitutes a capital receipt. Income-tax liability for such transactions is determined by the specific provisions of the Income Tax Act, independent of the accounting treatment in the books of account.

409

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2007 to 2026.

Also referred to as

Sutlej Cotton Mills Ltd · 116 ITR 1 · capital receipt · foreign exchange gain · forward contract · capital asset · Section 43A · income tax liability · accounting treatment · capital gains

Sections most often in play

Section 14ASection 37(1)Section 115JBSection 143(3)Section 32Section 143(2)Section 142(1)Section 250
Read the full judgment

Issues it is cited on

section 43aeligible businessbook profitssection 115jsection 115jbrevenue expendituresection 80iamercantile system of accountingamalgamationsection 37(1)section 80isection 43

Judgments citing Sutlej Cotton Mills Ltd. v. CIT

DCIT, Chennai vs. Emerald Resilient Tyre Manufactures Pvt Ltd., Chennai

In the result, the Revenue appeal is allowed

ITA 371/CHNY/2014[2008-2009]Status: DisposedITAT Chennai21 Jun 2017AY 2008-2009

Bench: Shri Chandra Poojari & Shri. G. Pavan Kumar

For Appellant: Shri. Supriyo Pal, JCITFor Respondent: Shri. Vikram
Section 143(1)Section 143(2)Section 143(3)Section 147Section 148Section 43(5)

…l loan as is clear from the loan agreement wherein the purpose of the loan is clearly mentioned to use it as a working capital to finance the activities of the company. As held by the hon'ble Supreme Court in the case of Sutlej Cotton Mills Ltd. v. CIT [1979] 116 ITR 1, foreign currency fluctuation loss is allowable as deduction if the foreign currency is held on revenue account or as trading asset or as part of circulating capital employed in the business. As regards the year of allowability, the claim has to be allowed on the basis of restatement of the liability on the balance-sheet date as held by the hon'ble…

Rajasthan State Mines & Minerals Ltd., Jaipur vs. ACIT, Jaipur

In the result, appeal of the Revenue is partly allowed for statistical purpose

ITA 253/JPR/2015[2007-08]Status: DisposedITAT Jaipur30 May 2017AY 2007-08

…claim of expenditure, there is no requirement that it should be debited in the books of accounts for this proposition the Ld. Counsel for the assesssee relied upon the judgment of the Hon’ble Supreme Court rendered in the case of Satluj Cotton Mills vs CIT 116 ITR 1. He submitted that the Tribunal in assessee’s own case pertaining to the AY 2010-11 has decided the issue in favour of the assessee. 70.1 On the contrary, the Ld. Departmental Representatives supported the order of the authorities below. 70.2 We have heard the rival contention, perused the material available on record. The Ld. CIT(A) has reject…

Bechtel India Pvt. Ltd., New Delhi vs. ACIT, New Delhi

In the result, the appeal of the assessee is dismissed

ITA 1224/DEL/2017[2009-10]Status: DisposedITAT Delhi29 May 2017AY 2009-10

Bench: Sh. C.M. Garg & Sh. O.P. Kantassessment Year: 2009-10

Section 119Section 144CSection 153Section 254Section 271Section 37(1)

…L account and is not to be adjusted against the cost of raw materials.” 13 4.5.3 The Hon’ble Supreme Court in the case of Woodward Governor (supra) has followed the decision of the Hon’ble Supreme Court in the case of Sutlej Cotton Mills Ltd. Vs. CIT, (1979) 116 ITR 1 (SC), where it is held that if loss of foreign exchange fluctuation was on account of trading liability, the same would be allowable. Further, Hon’ble Delhi High Court in the case of Eicher Good Earth in ITA No. 7078 of 1992 observed that the mercantile system of accounting made it mandatory to translate the outstanding liability on the basis of fl…

M/S Canara Housing Development Company, Bangalore vs. JCIT, Bangalore

In the result, the appeal of the assessee is allowed

ITA 193/BANG/2014[2005-06]Status: DisposedITAT Bangalore12 May 2017AY 2005-06

Bench: Shri Vijay Pal Rao & Shri Inturi Rama Rao

For Appellant: Shri Vijay Mehta & Shri R. Ramakrishnan, CAsFor Respondent: Ms. Neera Malhotra, CIT (DR) (ITAT)-2, Bengaluru
Section 143(3)

…IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH ‘ B ’ BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER I.T. A. No.193/Bang/2014 (Assessment Year : 2005-06) M/s. Canara Housing Development Company, No.10/1, Lakshminarayana Complex, Palace Road, Bangalore-560 052. …. Appellant. Vs. Joint Commissioner of Income Tax (OSD), Central Range, Bangalore. ….. Respondent. Appellant By : Shri Vijay Mehta & Shri R. Ramakrishnan, CAs Respondent By : Ms. Neera Malhotra, CIT (DR) (ITAT)-2, Bengaluru. Date of Hearing : 28.03.2017. Date of Pronouncement : 12.05.2017. O R D E R Per…

The Rajasthan State Co-Op. Bank Ltd., Jaipur vs. DCIT, Jaipur

In the result, appeal filed by the assessee is dismissed

ITA 266/JPR/2013[2007-08]Status: DisposedITAT Jaipur17 Apr 2017AY 2007-08
For Appellant: Shri S.R. Sharma (C.A)For Respondent: Shri R.A.Verma (JCIT)
Section 143(3)Section 41Section 41(1)Section 80PSection 80P(2)Section 80P(4)

…dded to the income. The Hon’ble Apex Court in the following cases have held that book entries are not conclusive. 1. Kedarnath Jute Mfg. Co. Ltd. Vs. CIT, 82 ITR 363 (SC) 2. CIT vs. Indian Discount Co. Ltd. 75 ITR 191 (SC) 3. Satluj Cotton Mills Ltd. Vs. CIT, 116 ITR 1 (SC) 4. CIT vs. Tuticorin Alkali Chemicals & Fertilizers Ltd., 227 ITR 172 SC 5. CIT Vs. Shoorji Vallabhdas & Co., 46 ITR 144 (SC) 6. CIT vs. Triveni Engineering & Industries Ltd., 181 Taxman 5 (Del.) Thus the issue is not to be decided simply on the basis that the entries have been made in the balance sheet and not in the P & L A/c. We are not hav…

Ultra Tech Cement Ltd, Mumbai vs. Addl CIT RG 2(2), Mumbai

In the result appeals of the Revenue are dismissed, whereas appeals of the assessee are allowed in part in terms indicated hereinabove

ITA 5065/MUM/2014[2009-10]Status: DisposedITAT Mumbai05 Apr 2017AY 2009-10

Bench: Shri R.C.Sharma, Am & Shri Sandeep Gosain, Jm M/S. Ultratech Cement Ltd., Vs. Acit – 2(2), Mumbai Ahura Centre, B Wing, 2Nd Floor, Mahakali Caves Road, Andheri – East Mumbai – 400 093 Pan/Gir No. Aaacl6442L Appellant) .. Respondent) M/S. Ultratech Cement Ltd., Vs. Dcit – 2(2), Mumbai Ahura Centre, B Wing, 2Nd Floor, Mahakali Caves Road, Andheri – East Mumbai – 400 093 Pan/Gir No. Aaacl6442L Appellant) .. Respondent) Acit – 2(2), Mumbai Vs. M/S. Ultratech Cement Ltd., Ahura Centre, B Wing, 2Nd Floor, Mahakali Caves Road, Andheri – East Mumbai – 400 093 Pan/Gir No. Aaacl6442L Appellant) .. Respondent) Dcit – 2(2), Mumbai Vs. M/S. Ultratech Cement Ltd., Ahura Centre, B Wing, 2Nd Floor, Mahakali Caves Road, Andheri – East Mumbai – 400 093 Pan/Gir No. Aaacl6442L Appellant) .. Respondent) M/S. Ultratech Cement Ltd., Assessee By Shri Arvind Sonde Alongwith Shri Sampat Kabra Revenue By Smt. S.Padmaja

Section 127Section 143(3)Section 14ASection 271Section 80Section 80l

…nath Jute Manufacturing Company Ltd 82 ITR 362; in the case of Tutcorin Alali Chemicals Ltd in 227 ITR 172; in the case of Godhra Electricity Company in 91 Taxman 91; in the case of Bokaro Steel Ltd in 263 ITR 315 and in the case of Sutlet Cotton Mills Ltd in 116 ITR 1 and submitted that it would be totally incorrect to say that an assessee who raises internal invoices would be entitled to benefit of Sec 80IA and an assessee who does not raise internal invoices would not be entitled to such benefit. 13.2. The assessee further submitted that Sec. 80IA(8) itself contemplates a situation where goods or services are…

M/S.. Synthes Medical Pvt. Ltd., New Delhi vs. DCIT, New Delhi

In the result, both the appeals for assessment years 2007-08 and 2008-09 filed by the assessee are partly allowed for statistical purposes and the appeal filed by the Revenue is dismissed

ITA 6006/DEL/2013[2008-09]Status: DisposedITAT Delhi31 Mar 2017AY 2008-09

Bench: Sh. Sudhanshu Srivastava & Sh. O.P. Kant

Section 143(2)Section 143(3)Section 32(1)Section 37(1)

…e of provisions contained in the Act [See - Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363 (SC); Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT [1997] 227 ITR 172/93 Taxman 502 & ITA No. 5807/Del/2013 (SC); Sutlej Cotton Mills Ltd. v. CIT [1979] 116 ITR 1 (SC) and United Commercial Bank v. CIT [1999] 240 ITR 355/106 Taxman 601 (SC). 20. At the most, an inference can be drawn that by showing this expenditure in a spread over manner in the books of account, the assessee had initially intended to make such an option. However, it abandoned the same before reaching the crucial stage, inasmuch as, in the…

M/S.. Synthes Medical Pvt. Ltd., New Delhi vs. DCIT, New Delhi

In the result, both the appeals for assessment years 2007-08 and 2008-09 filed by the assessee are partly allowed for statistical purposes and the appeal filed by the Revenue is dismissed

ITA 6005/DEL/2013[2007-08]Status: DisposedITAT Delhi31 Mar 2017AY 2007-08

Bench: Sh. Sudhanshu Srivastava & Sh. O.P. Kant

Section 143(2)Section 143(3)Section 32(1)Section 37(1)

…e of provisions contained in the Act [See - Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363 (SC); Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT [1997] 227 ITR 172/93 Taxman 502 & ITA No. 5807/Del/2013 (SC); Sutlej Cotton Mills Ltd. v. CIT [1979] 116 ITR 1 (SC) and United Commercial Bank v. CIT [1999] 240 ITR 355/106 Taxman 601 (SC). 20. At the most, an inference can be drawn that by showing this expenditure in a spread over manner in the books of account, the assessee had initially intended to make such an option. However, it abandoned the same before reaching the crucial stage, inasmuch as, in the…

DCIT, New Delhi vs. M/S. Synthes Medical Pvt. Ltd., New Delhi

In the result, both the appeals for assessment years 2007-08 and 2008-09 filed by the assessee are partly allowed for statistical purposes and the appeal filed by the Revenue is dismissed

ITA 5807/DEL/2013[2008-09]Status: DisposedITAT Delhi31 Mar 2017AY 2008-09

Bench: Sh. Sudhanshu Srivastava & Sh. O.P. Kant

Section 143(2)Section 143(3)Section 32(1)Section 37(1)

…e of provisions contained in the Act [See - Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363 (SC); Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT [1997] 227 ITR 172/93 Taxman 502 & ITA No. 5807/Del/2013 (SC); Sutlej Cotton Mills Ltd. v. CIT [1979] 116 ITR 1 (SC) and United Commercial Bank v. CIT [1999] 240 ITR 355/106 Taxman 601 (SC). 20. At the most, an inference can be drawn that by showing this expenditure in a spread over manner in the books of account, the assessee had initially intended to make such an option. However, it abandoned the same before reaching the crucial stage, inasmuch as, in the…

ITO 16(2)(4), Mumbai vs. Surya Gems, Mumbai

The appeal of the Revenue is dismissed

ITA 292/MUM/2014[2009-10]Status: DisposedITAT Mumbai08 Mar 2017AY 2009-10

Bench: Shri Joginder Singh & Shri N.K. Pradhanassessment Year: 2009-10 Income Tax Officer-16(2)(4), M/S Surya Gems, बनाम/ 02Nd Floor, Matru Mandir, Flat No.4, 02Nd Floor, Tardeo Road, Bhaveshwar Sgar Patel Vs. Mumbai-400007 Compound 20 Napean Sea Road, Mumbai-400020 (याजस्व /Revenue) (यनधाारयती /Assessee) P.A. No. Aakfs6513Q याजस्व की ओर से / Revenue By Shri B.S. Bist-Dr यनधाारयती की ओर से / Assessee By None ुनवाई की तायीख / Date Of Hearing : 14/02/2017 आदेश की तायीख /Date Of Order: 08/03/2017

…scrutiny of the said decision indicates that the Calcutta High Court in this case relied upon its earlier judgement in Sutlej Cottons Mills Ltd v CIT (1971) 81 ITR 641. It will be recalled that the Hon‘ble Supreme Court in Sutlej Cotton Mills Ltd v CIT(1979) 116 ITR 1 reversed the aforesaid decision of the Calcutta High Court on this point and held that such liability would be treated as a trading loss. In that view of the matter, the reliance placed by the revenue on the judgement of the Calcutta High Court in Bestobell (India Ltd., (1979) 117 ITR 789 appears misplaced.‖ 56. The controversy stands now resolved…

M/S Ispat Enterprises Pvt. Ltd., Kolkata vs. ITO, Ward-6(2), Kolkata

In the result, the appeal of assessee is partly allowed

ITA 1738/KOL/2016[2011-12]Status: DisposedITAT Kolkata10 Feb 2017AY 2011-12
Section 143(2)

…Audit Report. Purchase is net of Rs.3569063.20, net Credit note from suppliers. 7. In support of the contentions, the assessee has also relied on the followings:- 1) Ramchandar Sivnarayan v. CIT (1978) 111 ITR 263(SC) 2) Sutlej Cotton Mills Ltd v. CIT (1979) 116 ITR 1 (SC) 3) Davidson of India P.Ltd v. CIT (1983) 140 ITR 344 (Cal). 4) CIT v. Dhnarigiri Raja Narsingiriji 91 ITR 544(SC) 5) CIT v. Dalmia Cement Ltd 254 ITR 377, and 6) CIT v. National Rayan Commercial Co. Ltd 193 ITR 744 8. The CIT-A has not accepted the submissions of assessee for the reason that the assessee in most of cases sold the goods direct…

DCIT Cir 6(1), Mumbai vs. Aegis Ltd, Mumbai

In the result, whereas appeal of the assessee is partly allowed, that of the Revenue is dismissed

ITA 1209/MUM/2015[2010-11]Status: DisposedITAT Mumbai08 Feb 2017AY 2010-11

Bench: Shri G.S.Pannu & Shri Sandeep Gosainaegis Limited, Essar Techno Park, Old Swan Mill Compound, Lbs Marg, Kurla (W), Mumbai 400 070 Pan:Aaace 8354Q ...... Appellant

For Appellant: S/Shri Rajan Vora/For Respondent: Shri N.K.Chand
Section 143(3)Section 92CSection 92C(2)

…o re- characterize lawfully consummated transaction(s), where no such power, express or implied, is conferred on him by the Act. d. The learned AO failed to follow the law laid down by the Hon'ble Supreme Court in the case of Sutlej Cotton Mills Ltd. vs CIT (116 ITR 1) and CIT vs Woodward Governor India P. Ltd. (312 ITR 254) that where gain accrues on foreign currency held as a capital asset, the same would be of capital nature. 23. The learned AO I DRP have erred in charging interest under section 234B and section 234C of the Act. 24. The learned AO I DRP have erred in giving short credit of TDS deposited to…

Aegis Ltd, Mumbai vs. DCIT RG 5(1), Mumbai

In the result, whereas appeal of the assessee is partly allowed, that of the Revenue is dismissed

ITA 7694/MUM/2014[2010-11]Status: DisposedITAT Mumbai08 Feb 2017AY 2010-11

Bench: Shri G.S.Pannu & Shri Sandeep Gosainaegis Limited, Essar Techno Park, Old Swan Mill Compound, Lbs Marg, Kurla (W), Mumbai 400 070 Pan:Aaace 8354Q ...... Appellant

For Appellant: S/Shri Rajan Vora/For Respondent: Shri N.K.Chand
Section 143(3)Section 92CSection 92C(2)

…o re- characterize lawfully consummated transaction(s), where no such power, express or implied, is conferred on him by the Act. d. The learned AO failed to follow the law laid down by the Hon'ble Supreme Court in the case of Sutlej Cotton Mills Ltd. vs CIT (116 ITR 1) and CIT vs Woodward Governor India P. Ltd. (312 ITR 254) that where gain accrues on foreign currency held as a capital asset, the same would be of capital nature. 23. The learned AO I DRP have erred in charging interest under section 234B and section 234C of the Act. 24. The learned AO I DRP have erred in giving short credit of TDS deposited to…

DCIT, Bangalore vs. M/S Tesco Hindustan Service Centre Pvt. Ltd., Bangalore

In the result, both the assessee's appeal as well as revenue’s appeal are partly allowed

ITA 191/BANG/2015[2010-11]Status: DisposedITAT Bangalore25 Jan 2017AY 2010-11

Bench: Shri Vijay Pal Rao & Shri Inturi Rama Rao

For Appellant: Shri S. Raghunathan, AdvocateFor Respondent: Ms. Neera Malhotra, CIT (D.R)
Section 10ASection 143(3)Section 92C

…r the purpose of the Act. The liability under the Act is governed by provisions of the Act and is not dependent on the treatment followed for the same in the books of accounts. For above proposition, reference is made to Sutlej Cotton Mills Ltd. v. CIT [1979] 116 ITR 1 (SC) and Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363 (SC). AS-9 on accounting for leases classifies lease transactions for accounting purposes as under: (i) Finance Lease (ii) Operating Lease 5.2 Finance Lease, in AS-19, is described as a lease that transfers substantially all the risks and rewards in respect of ownership of an asset; t…

Linfox Logistics (India) P.Ltd, Mumbai vs. Asst CIT 10(1), Mumbai

In the result, appeal of the revenue is dismissed whereas appeal of the assessee is allowed in part in terms indicated hereinabove

ITA 5704/MUM/2013[2009-10]Status: DisposedITAT Mumbai24 Jan 2017AY 2009-10

Bench: Shri R.C.Sharma, Am & Shri Ravish Sood, Jm M/S. Linfox Logistics (India) Vs. Acit – 10 (1), Mumbai Pvt. Ltd., B-403, Universal Business Park, Chandivali Farm Road, Chandivali, Andheri-East, Mumbai – 400 072 Pan/Gir No. Aabcl1515H Appellant) Respondent) .. Dcit – 10 (1), Mumbai Vs. M/S. Linfox Logistics (India) Pvt. Ltd., B-403, Universal Business Park, Chandivali Farm Road, Chandivali, Andheri-East, Mumbai – 400 072 Pan/Gir No. Aabcl1515H Appellant) .. Respondent) Assessee By Shri Rajan Vora Revenue By Shri R.P.Meena

Section 143(3)Section 195Section 40Section 40aSection 68

…ound. 13. This issue was discussed in great detail in the recent landmark ruling of Supreme Court in the case of ClT vs Woodward Governor India P. Ltd (312 ITR 254) where in the SC relied on the earlier judgment in the case of Sutlej Cotton Mills Ltd vs. CIT (116 ITR 1) which observed as follows :- "The law may, therefore, now be taken to be well settled that where profit or loss arises to an assessee on account of appreciation or depreciation in the value of foreign currency held by it, on conversion into another currency, such profit or loss would ordinarily be a trading profit or loss if the foreign currency i…

DCIT 10(1), Mumbai vs. Linfox Logistics (I) P.Ltd, Mumbai

In the result, appeal of the revenue is dismissed whereas appeal of the assessee is allowed in part in terms indicated hereinabove

ITA 5643/MUM/2013[2009-10]Status: DisposedITAT Mumbai24 Jan 2017AY 2009-10

Bench: Shri R.C.Sharma, Am & Shri Ravish Sood, Jm M/S. Linfox Logistics (India) Vs. Acit – 10 (1), Mumbai Pvt. Ltd., B-403, Universal Business Park, Chandivali Farm Road, Chandivali, Andheri-East, Mumbai – 400 072 Pan/Gir No. Aabcl1515H Appellant) Respondent) .. Dcit – 10 (1), Mumbai Vs. M/S. Linfox Logistics (India) Pvt. Ltd., B-403, Universal Business Park, Chandivali Farm Road, Chandivali, Andheri-East, Mumbai – 400 072 Pan/Gir No. Aabcl1515H Appellant) .. Respondent) Assessee By Shri Rajan Vora Revenue By Shri R.P.Meena

Section 143(3)Section 195Section 40Section 40aSection 68

…ound. 13. This issue was discussed in great detail in the recent landmark ruling of Supreme Court in the case of ClT vs Woodward Governor India P. Ltd (312 ITR 254) where in the SC relied on the earlier judgment in the case of Sutlej Cotton Mills Ltd vs. CIT (116 ITR 1) which observed as follows :- "The law may, therefore, now be taken to be well settled that where profit or loss arises to an assessee on account of appreciation or depreciation in the value of foreign currency held by it, on conversion into another currency, such profit or loss would ordinarily be a trading profit or loss if the foreign currency i…

Essel Infraprojects Ltd, Mumbai vs. DCIT Cir 7(1), Mumbai

In the result, both the appeals filed by the revenue are dismissed and the appeal of the assessee for AY 2006-07 is treated as allowed

ITA 4244/MUM/2013[2006-07]Status: DisposedITAT Mumbai11 Jan 2017AY 2006-07

Bench: Shri B.R. Baskaran (Am)& Ramlal Negi (Jm)

Section 36(1)(iii)

…of the business and to be incidental to it. If that is established, then the deduction must be allowed provided of course there is no prohibition against it, express or implied, in the Act." This view is also upheld by Apex Court in Sutlej Cotton Mills Ltd. (116 ITR 1) and jurisdictional High Court in Dempo & Co. (P) Ltd. (206 1TR 291) wherein it was held that "whether the assessee is entitled to a particular deduction or not will depend on the provision of law relating thereto and not on the view which the assessee might take of his rights nor can the existence or absence of entries in the books of account be d…

Piramal Glass Ltd, Mumbai vs. DCIT 7(3)(2), Mumbai

The appeal of the assessee stands partly allowed

ITA 157/MUM/2016[2011-12]Status: DisposedITAT Mumbai04 Jan 2017AY 2011-12

Bench: Shri Amit Shukla, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No. 157/Mum/2016 ("नधा"रण वष" / Assessment Year : 2011-2012) M/S Piramal Glass Ltd. Deputy Commissioner Of (Earlier Known As ‘Gujarat Glass Pvt. Ltd.’) Income Tax 7(3)(2) बनाम/ Room No. 669A, 6Th Floor Piramal Tower Ganpatrao Kadam Marg Aaykar Bahwan Vs. Lower Parel M.K.Road, Churchgate Mumbai 400013 Mumbai 400020 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aabcg-0093-R (अपीलाथ" /Appellant) (""यथ" / Respondent) :

Section 115PSection 143(3)Section 156Section 92C

…followed accounting policy regarding treatment of foreign exchange on loans. The loans advanced to subsidiary are capital in nature and therefore, the same are not taxable. Reliance has been placed on the Apex court judgment of Sutlej Cotton Mills Ltd. V CIT 116 ITR 1 to contend that gain / loss on foreign exchange held on ‘Capital Account’ is capital in nature and held in ‘revenue account’ is revenue in nature. Per contra, Ld. DR contended that when assessee made suo- moto disallowance of exchange loss in 2010-11 then the benefit of the same could not be given by AO as he had no power to reduce the income of th…

ACIT Cir 6(1), Mumbai vs. Idea International P. Ltd, Mumbai

Appeal of the revenue is hereby partly allowed

ITA 7116/MUM/2011[2007-08]Status: DisposedITAT Mumbai28 Oct 2016AY 2007-08

Bench: Shri G.S.Pannu, Am & Shri Amarjit Singh, Jm आयकर अपील सं/ I.T.A. No.7116/M/11 (िनधा"रण वष" / Assessment Year: 2007-08) Acit Cir. 6(1) बनाम/ M/S. Idea International Pvt. R.No.506, 5Th Floor, Ltd. Vs. Aaykar Bhavan, M.K.Road, 36/40, Mahalaxmi Bridge Mumbai - 400020 Arcade, Mahalaxmi, Worli, Mumbai - 400034 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aabci1527J (अपीलाथ" /Appellant) .. (""थ" / Respondent)

For Appellant: Shri Haridas BhattFor Respondent: Shri B.C.S.Naik
Section 142(1)Section 143(1)Section 14A

…in the relevant assessment year. Before analyzing this aspect, we may state certain principles governing this issue. Entries in books of account are not determining factor to decide the true nature of transaction – (1978) Sutlej Cotton Mills Ltd. Vs. CIT(A), 116 ITR 1 (SC). Whatever a particular activity is a business activity, depends on peculiar facts of the case - G.Venkataswami Naidu & Co. Vs. CIT, (1958) 35 ITR 594 (SC). Frequency and regularity of share transactions is organized manner indicate business activity [Raja Bahadur Visheshwara Singh Vs. CIT, 41 ITR 685(SC)]. CBDT in its Circular no.4 of 2007 dat…

Hero Motocorp Limited, New Delhi vs. JCIT, New Delhi

In the result appeal of the assessee in ITA No

ITA 1545/DEL/2015[2010-11]Status: DisposedITAT Delhi24 Oct 2016AY 2010-11

Bench: Sh. I. C. Sudhir & Shri Prashant Maharishihero Motocorp Limited, Jcit, 34, Basant Lok, Vasant Range-1, New Delhi Vs. Vihar, New Delhi Pan: Aaach0812J (Appellant) (Respondent) Dcit, M/S. Hero Moto Corp. Circle-11(1), Ltd., 34, Community Vs. New Delhi Centre, Basant Lok, Vasant Vihar, New Delhi-110057 (Appellant) (Respondent) Dcit, M/S. Hero Moto Corp. Circle-11(1), Ltd., 34, Community

For Appellant: Sh. Ajay Vohra, Sr. AdvFor Respondent: Sh. NC Sawain, CIT DR
Section 143Section 143(3)Section 144CSection 92C

…quently at a lower rate. The difference of Rs. 4 (50-46) per US $ is to be shown as an exchange loss in the P&L account and is not to be adjusted against the cost of raw materials. 20. In the case of Sutlej Cotton Mills Ltd. vs. CIT 1978 CTR (SC) 155 : (1979) 116 ITR 1 (SC) this Court has observed as under : "The law may, therefore, now be taken to be well settled that where profit or loss arises to an assessee on account of appreciation or depreciation in the value of foreign currency held by it, on conversion into another currency, such profit or loss would ordinarily be a trading profit or loss if the Hero Mot…