United Commercial Bank v. CIT

240 ITR 355Supreme Court of India1999#245 most cited

What is United Commercial Bank v. CIT authority for?

Liabilities accrued on a notional basis are allowable as deductions under the mercantile system of accounting even if their exact quantification or discharge is deferred to a future date or if the demand itself is disputed.

314

judgments rely on this decision, according to BharatTax’s citation analysis of 367,154 Indian tax judgments — from 2009 to 2026.

Also referred to as

United Commercial Bank v. CIT · Section 145 · Section 37(1) · mercantile system of accounting · accrual basis deduction · unascertained liability · provision for expenses · deferred quantification · disputed liability · business deductions

Also reported as

156 CTR 380

Sections most often in play

Section 143(3)Section 37(1)Section 36(1)(viia)Section 14ASection 36(1)(vii)Section 145Section 36(1)(viii)Section 10(34)

Issues it is cited on

section 36(2)(v)section 145(1)section 36(1)(viia)section 36(2)section 36(1)(vii)interest on securitiesmercantile system of accountingsection 10(34)profits and gains of business or professionsection 145section 36(1)disallowance u/s 14a

Judgments citing United Commercial Bank v. CIT

Asst.C.I.T., Bellary vs. Pragathi Gramin Bank, Bellary

In the result, all the appeals filed by the Revenue is dismissed

ITA 35/BANG/2016[2011-12]Status: DisposedITAT Bangalore05 Feb 2020AY 2011-12

Bench: Shri N.V Vasudevan, Vice Presidnet & Shri B.R Baskaran

For Appellant: Shri Pradeep Kumar, CIT (DR)For Respondent: Smt. Sheetal, Advocate
Section 145

…e Hon'ble Karnataka High Court in the case of Karnataka Bank (supra), the Hon'blè High Court made reference to the decisions of the Hon'ble Supreme Court in the case of UCO Bank (237 ITR ITA No.35& 36/Bang/2016 Page 4 of 19 889) and United Commercial Bank (240 ITR 355) and came to the conclusion that the method of accounting followed by the assessee has to be judged by the provisions of section 145 of the Act. Thereafter, the Hon'ble High Court referred to the decision of the Hon’ble Supreme Court in the case of Southern Technologies Ltd. Vs. JCIT (320 1TR 577) wherein it was held that RBI direction's and guid…

State Bank of India, Mumbai vs. Addl CIT RG 2(2), Mumbai

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

ITA 3644/MUM/2016[2008-09]Status: DisposedITAT Mumbai03 Feb 2020AY 2008-09

Bench: Sri Mahavir Singh, Vp & Sri G Manjunatha, Am आयकर अपील सुं./ Ita No. 3644/Mum/2016 (ननर्ाारण वर्ा / Assessment Year 2008-09) State Bank Of India The Dy. Commissioner Of 3Rd Floor, Corporate Centre Income Tax, Circle -2(2)(1) बनाम/ Madam Cama Road Mumbai Vs. Nariman Point Mumbai-400021 (अपीलार्थी / Appellant) (प्रत्यर्थी/ Respondent) स्र्थायी लेखा सुं./Pan No. Aaacs8577K

For Appellant: Shri P.J. Pardiwalla &For Respondent: Shri Anadi Varma, CIT-DR&
Section 143(3)Section 147

…ere is no provision of law or principle according to which the assessee could be compelled to adopt either the average cost for all the items or the market rate for all the items. Further, the Supreme Court in the case of United Commercial Bank vs. CIT [1999] 240 ITR 355 (SC) has held that there is no such question of following two different methods for valuing its stock-in-trade (investments) because bank was required to prepare balance sheet in the prescribed form and it had no option to change it and for the purpose of income-tax, what is taxed is the real income which is to be deduced on the basis of the acco…

Jt. CIT -(OSD)-2(1)(2), Mumbai vs. Central Bank of India, Mumbai

In the result, appeal of the revenue is dismissed

ITA 3673/MUM/2018[2012-13]Status: DisposedITAT Mumbai29 Jan 2020AY 2012-13

Bench: Shri M. Balaganesh, Am & Shri Amarjit Singh, Jm Central Bank Of India Vs. The Deputy Commissioner 4Th Floor, Of Income Tax – 2(1) Chandermukhi Building Aayakar Bhavan Nariman Point Mumbai – 400 020 Mumbai – 400 021 Pan/Gir No.Aaacc2498P (Appellant) .. (Respondent) Jt. Cit (Osd)-2(1)(2) Vs. Central Bank Of India R.No.561, 5Th Floor 4Th Floor, Aayakar Bhavan, M.K.Road Chandermukhi Building Mumbai – 400 020 Nariman Point Mumbai – 400 021 Pan/Gir No.Aaacc2498P (Appellant) .. (Respondent) Assessee By Shri Nitesh Joshi Revenue By Shri V. Sreekar Date Of Hearing 16/01/2020 Date Of Pronouncement 29/01/2020 आदेश / O R D E R Per M. Balaganesh (A.M): These Cross Appeals In Ita Nos.3739/Mum/2018 & 3673/Mum/2018 For A.Y.2012-13 Arises Out Of The Order By The Ld. Commissioner Of Income Tax (Appeals)-3, Mumbai In Appeal No.Cit(A)-3/Dcit2(1) It- 44/Tr.4/16-17 Dated 30/01/2018 (Ld. Cit(A) In Short) Against The Order Of Assessment Passed U/S.143(3) Of The Income Tax Act, 1961 (Hereinafter Referred To As Act) Dated 25/03/2014 By The Ld. Dy. Commissioner Of Income Tax -2(1), Mumbai (Hereinafter Referred To As Ld. Ao).

Section 143(3)Section 14ASection 14A(2)

…rds loss incurred on diminution in value of investment held as stock-in- trade. In this M/s. Central Bank of India regard, he relied upon the decision of the Bank of Baroda (supra) and Hon'ble Supreme Court in the case of United Commercial Bank vs. CIT [1999] 240 ITR 355 (SC). 13. We have heard both the parties and perused the materials available on record. The Assessing Officer has disallowed diminution in value of investment held as stock-in-trade on the ground that the loss incurred by the assessee on account of diminution in value of investment is a notional loss which cannot be allowed as deduction. Accordin…

M/S. Gl Litmus Events Pvt. Ltd., New Delhi vs. ACIT, New Delhi

The appeal of the assessee is partly allowed

ITA 2682/DEL/2017[2012-13]Status: DisposedITAT Delhi17 Jan 2020AY 2012-13

Bench: Shri R.K. Panda & Shri Sudhanshu Srivastavam/S.Gl Litmus Events Pvt. Vs. Acit Ltd. Central Circle-17, B-90, Second Floor, Room No. 356, Vishwakarma Colony Ara Centre, New Delhi – 110 044 Jhandewalan Extension Pan Aadcg6909N New Delhi – 110 055 (Appellant) (Respondent) Asstt. Year: 2012-13

For Appellant: Shri S.K. Tulsiyan, AdvocateFor Respondent: Shri Raghunath, Sr. DR
Section 145(3)Section 234ASection 234BSection 250(6)Section 271(1)(c)

…re, on reading of the above 10 GL Litmus Events Pvt. Ltd. vs ACIT provision it is amply clear that the choice of method of accounting lies with the assessee. The honourable Supreme Court in case of United Commercial Bank vs. Commissioner of income tax (1999) 240 ITR 355 (SC) at page no366 has held that:- “From the decisions discussed above, it can be held: (1) That for valuing the closing stock, it is open to the assessee to value it at the cost or market value, whichever is lower; (2) In the balance sheet, if the securities and shares are valued at cost but from that no firm conclusion can be drawn. A taxpayer…

ACIT, New Delhi vs. M/S. Oriental Bank of Commerce, Gurgaon

In the result, both the appeals of the Revenue in ITA Nos

ITA 5845/DEL/2016[2008-09]Status: DisposedITAT Delhi11 Dec 2019AY 2008-09

Bench: Shri N.K. Billaiya & Ms. Suchitra Kamble

For Appellant: Shri K.V.S.R. Krishna, CAFor Respondent: Ms. Pramita M. Biswas, CIT-DR
Section 271(1)(c)

…of Income Tax 356 ITR 549 and CIT vs. Bank of Baroda 262 ITR 334 and a decision of honourable Bombay High Court in case of CIT vs. HDFC Bank Ltd. reported at 368 ITR 377 considering decision of honourable supreme court in case of united commercial bank V CIT 240 ITR 355 and Southern technologies Limited V Jt CIT 320 ITR 577, wherein Hon’ble High Court has held as under:- “9. In the present case, we find that the facts and issues that are covered by the aforesaid judgment squarely apply to the facts and issues raised in the present Appeal. Not only are we in full agreement with the judgment of this Court in the…

ACIT, New Delhi vs. M/S. Oriental Bank of Commerce, Gurgaon

In the result, both the appeals of the Revenue in ITA Nos

ITA 5846/DEL/2016[2009-10]Status: DisposedITAT Delhi11 Dec 2019AY 2009-10

Bench: Shri N.K. Billaiya & Ms. Suchitra Kamble

For Appellant: Shri K.V.S.R. Krishna, CAFor Respondent: Ms. Pramita M. Biswas, CIT-DR
Section 271(1)(c)

…of Income Tax 356 ITR 549 and CIT vs. Bank of Baroda 262 ITR 334 and a decision of honourable Bombay High Court in case of CIT vs. HDFC Bank Ltd. reported at 368 ITR 377 considering decision of honourable supreme court in case of united commercial bank V CIT 240 ITR 355 and Southern technologies Limited V Jt CIT 320 ITR 577, wherein Hon’ble High Court has held as under:- “9. In the present case, we find that the facts and issues that are covered by the aforesaid judgment squarely apply to the facts and issues raised in the present Appeal. Not only are we in full agreement with the judgment of this Court in the…

DCIT 1(1)(1), Mumbai vs. Concorde Motors (India) Ltd, Mumbai

In the result, appeal of the assessee is dismissed

ITA 2333/MUM/2017[2012-13]Status: DisposedITAT Mumbai01 Oct 2019AY 2012-13

Bench: Shri R.C. Sharma & Shri Pawan Singhacit-1(1)(1) M/S. Concorde Motors (India) Ltd., 3Rd Floor, Nanavati 579, Aayakar Bhawan, M. K. Road, Vs. Mahalaya, 18, Homy Modi Street, Mumbai-400020. Hutatma Chowk, Mumbai-400001. Pan: Aaacm0154A Appellant Respondent

For Appellant: Shri Abi Rama Karthikeyan (Sr DR)For Respondent: Shri Rajan Vora with Shri Nikhil Tiwari (AR)
Section 115JSection 143(3)Section 2Section 254(1)

…ology upgradation and launch of new models and in cost competition due to other various external factors. To support its submission that valuation of closing stock is to be done at lower of the cost or NRV on the following decision:  United Commercial Bank (240 ITR 355) (SC).  Hughes Communication India Ltd. (215 Taxman 136) (Del HC).  Indian Sugar & Gen. Industry Export Import (349 ITR 38) (Del HC).  Alfa Laval (India) Ltd. (133 Taxman 740) (Hom HC).  Edelweiss Capital Ltd. (ITA No. 5324/Mum/2007).  Edel Commodities Ltd. (170 ITD 402) (Mum Trib.). 5. The ld. AR of the assessee submits that the ld. CIT(A)…

Idbi Bank Ltd., Mumbai vs. ACIT (Ltu)-2, Mumbai

In the result this ground of appeal is

ITA 3423/MUM/2018[2008-09]Status: DisposedITAT Mumbai03 Sept 2019AY 2008-09

Bench: Shri R.C. Sharma & Shri Pawan Singh

Section 115JSection 143(3)Section 147Section 148Section 254(1)

…red thorough examination of fact and directed the assessing officer to examine the assessee’s claim on merit. 27. The Hon’ble Bombay High Court in CIT Vs Bank of Baroda (supra) while relying on the decision of Supreme Court in case of UCO Bank v. CIT [1999] 240 ITR 355/106 Taxman 601, held that where the market value of shares and securities had fallen below the cost before the date of valuation and where on the date of valuation, the market value is less than the actual cost, then the assessee was entitled to value the articles at IDBI Bank Ltd (AY’s 2008-09, 2011-12 to 2013-14) market price and the assessee…

DCIT Corporate Circle 4(2), Chennai vs. Khazanchi Jewellers Pvt Ltd., Chennai

In the result, the appeal of the Revenue stands dismissed

ITA 1030/CHNY/2018[2011-12]Status: DisposedITAT Chennai21 Aug 2019AY 2011-12

Bench: Shri Inturi Rama Rao & Shri Duvvuru Rl Reddy] आयकर अपील सं./I.T.A. No.1030/Chny/2018. "नधा"रण वष" /Assessment Year : 2011-2012. Vs. M/S. Khazanchi Jewellers Pvt Ltd, The Deputy Commissioner Of Income Tax, No.52, Nsc Bose Road, Corporate Circle 4(2) Sowcarpet, Chennai 600 034. Chennai 600 079. [Pan Aabck 4583E] (अपीलाथ"/Appellant) (""यथ"/Respondent)

For Appellant: Sheri. R. Clement Ramesh Kumar

…ut assessee is bound to show that he follows this method of accounting regularly. Reliance in this regard can be placed on the decisions of Hon'ble Supreme Court in the cases of CIT vs. British Paints India Ltd, 188 ITR 44 and United Commercial Bank vs. CIT, 240 ITR 355. It is equally settled principle of law that assessee’s method of accounting cannot be rejected as improper merely because it gave him benefit in certain years or because according to the Assessing Officer another method is preferable. Reliance can be placed on the decision of Hon’ble Andhra Pradesh High Court in the case of CIT vs. Margadarsi…

DCIT, New Delhi vs. M/S. Citi Financial Cosumer Finance India Ltd., New Delhi

In the result, appeal filed by Revenue is dismissed

ITA 3118/DEL/2016[2010-11]Status: DisposedITAT Delhi29 Jul 2019AY 2010-11

Bench: Shri H.S. Sidhu & Shri Anadee Nath Misshra

For Appellant: Shri Gaurav Gupta, AdvFor Respondent: Shri S.S. Rana, CIT(DR)
Section 143(3)

…the Act [See - Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82ITR 363 (SC); Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT [1997] 227ITR 172/93 Taxman 502 (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 draum 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 income tax return filed by the assessee, it chose to cl…

Bank of Bahrain & Kuwait B.S.C, Mumbai vs. Addl DIT (It) 3, Mumbai

The appeal of the assessee is partly allowed in terms of our aforesaid observations

ITA 2323/MUM/2014[2008-09]Status: DisposedITAT Mumbai17 Jul 2019AY 2008-09

Bench: Shri M. Balaganesh & Shri Ravish Soodita No. 2323/Mum/2014 (Assessment Year: 2008-09) Bank Of Bahrain & Kuwait Asst. Director Of Income Tax B.S.C. Jolly Maker Chambers Ii, (International Taxation) -3(2) 225, Nariman Point, Vs Mumbai. Mumbai – 400 021

For Appellant: Shri Farrokh V. Irani, A.RFor Respondent: Shri M.C. Omi Ningshen, Sr. D.R
Section 143(3)Section 144C(3)Section 44C

…oss account on day to day basis but contend that for purposes of income-tax only the interest that accrued on the coupon dates can be assessed. The Tribunal noticed the judgment of the Supreme Court in the case of another Bank, namely, United Commercial Bank (240 ITR 355). In this case the Supreme Court reversed the judgment of the Calcutta High Court which held that the assessee cannot prepare the computation of its income for income-tax purposes in a manner different from the method under which it keeps accounts. Applying the judgment of the Supreme Court, the Tribunal held that Union Bank of India cannot be pr…

ACIT Circle 1, Kumbakonam vs. City Union Bank Limited, Kumbakonam

In the result, appeal of the Revenue in ITA 1316/CHNY/2018

ITA 1316/CHNY/2018[2014-15]Status: DisposedITAT Chennai09 Jul 2019AY 2014-15

Bench: Shri George Mathan & Shri Inturi Rama Rao

For Appellant: Shri. S. Ananthan,C.AFor Respondent: Shri. Sailendra Mamidi, IRS
Section 143(3)Section 14ASection 36(1)Section 36(1)(vii)Section 40Section 41(1)

…in the assessee’s own caseand the submissions on the amortization expenses that it represents only depreciation loss written off in the books of accounts and is allowable expenditure and relied on the decision of Hon’ble Supreme Court in the case of UCO Bank 240 ITR 355 (SC), where it was held that depreciation in investments should be allowed as revenue expenditure. Since, the securities are stock in trade and valued at cost or market value whichever is less the claim has to be allowed. The Ld. CIT(A) placed reliance on Jurisdictional High Court decision in assessee's own case in 291 ITR 144 (Mds), where it was…

ACIT Circle 1, Kumbakonam vs. City Union Bank Limited, Kumbakonam

In the result, appeal of the Revenue in ITA 1316/CHNY/2018

ITA 1315/CHNY/2018[2012-13]Status: DisposedITAT Chennai09 Jul 2019AY 2012-13

Bench: Shri George Mathan & Shri Inturi Rama Rao

For Appellant: Shri. S. Ananthan,C.AFor Respondent: Shri. Sailendra Mamidi, IRS
Section 143(3)Section 14ASection 36(1)Section 36(1)(vii)Section 40Section 41(1)

…in the assessee’s own caseand the submissions on the amortization expenses that it represents only depreciation loss written off in the books of accounts and is allowable expenditure and relied on the decision of Hon’ble Supreme Court in the case of UCO Bank 240 ITR 355 (SC), where it was held that depreciation in investments should be allowed as revenue expenditure. Since, the securities are stock in trade and valued at cost or market value whichever is less the claim has to be allowed. The Ld. CIT(A) placed reliance on Jurisdictional High Court decision in assessee's own case in 291 ITR 144 (Mds), where it was…

City Union Bank Limited, Kumbakonam vs. ACIT Circle 1, Kumbakonam

In the result, appeal of the Revenue in ITA 1316/CHNY/2018

ITA 1130/CHNY/2018[2014-15]Status: DisposedITAT Chennai09 Jul 2019AY 2014-15

Bench: Shri George Mathan & Shri Inturi Rama Rao

For Appellant: Shri. S. Ananthan,C.AFor Respondent: Shri. Sailendra Mamidi, IRS
Section 143(3)Section 14ASection 36(1)Section 36(1)(vii)Section 40Section 41(1)

…in the assessee’s own caseand the submissions on the amortization expenses that it represents only depreciation loss written off in the books of accounts and is allowable expenditure and relied on the decision of Hon’ble Supreme Court in the case of UCO Bank 240 ITR 355 (SC), where it was held that depreciation in investments should be allowed as revenue expenditure. Since, the securities are stock in trade and valued at cost or market value whichever is less the claim has to be allowed. The Ld. CIT(A) placed reliance on Jurisdictional High Court decision in assessee's own case in 291 ITR 144 (Mds), where it was…

City Union Bank Limited, Kumbakonam vs. ACIT Circle 1, Kumbakonam

In the result, appeal of the Revenue in ITA 1316/CHNY/2018

ITA 1129/CHNY/2018[2012-13]Status: DisposedITAT Chennai09 Jul 2019AY 2012-13

Bench: Shri George Mathan & Shri Inturi Rama Rao

For Appellant: Shri. S. Ananthan,C.AFor Respondent: Shri. Sailendra Mamidi, IRS
Section 143(3)Section 14ASection 36(1)Section 36(1)(vii)Section 40Section 41(1)

…in the assessee’s own caseand the submissions on the amortization expenses that it represents only depreciation loss written off in the books of accounts and is allowable expenditure and relied on the decision of Hon’ble Supreme Court in the case of UCO Bank 240 ITR 355 (SC), where it was held that depreciation in investments should be allowed as revenue expenditure. Since, the securities are stock in trade and valued at cost or market value whichever is less the claim has to be allowed. The Ld. CIT(A) placed reliance on Jurisdictional High Court decision in assessee's own case in 291 ITR 144 (Mds), where it was…

M/S. Gl Litmus Events Pvt. Ltd., New Delhi vs. ACIT, New Delhi

Appeal of the assessee is partly allowed

ITA 2502/DEL/2015[2011-12]Status: DisposedITAT Delhi01 Jul 2019AY 2011-12

Bench: Shri Prashant Maharishi & Shri K. N. Charygl Litmus Events Pvt. Ltd, The Assistant Commissioner Vs. B-90, Second Floor, Of Income Tax Vishwakarma Colony, New Delhi Central Circle-7, New Delhi Pan: Aadcg6909N (Appellant) (Respondent)

For Appellant: Shri S. K. Tulsiyan, AdvFor Respondent: Shri Sanjay I Bara, CIT DR
Section 143Section 144CSection 153ASection 292CSection 37Section 69Section 92C

…NVESTMENT LTD VS. CIT 77 ITR 533 and stated that the taxpayer is free to employ any method of accounting but it should be consistently and regularly followed by him. He further relied upon the decision of the honourable Supreme Court in United commercial Bank 240 ITR 355 wherein the decision of the British paints India Ltd 188 ITR 44 was considered and stated that if the method of accounting adopted by the taxpayer is consistently and regularly, it cannot be discarded by the departmental authorities on the view that he should have adopted a different method of keeping of accounts. He also relied upon the decision…

Integral Urban Co-Operative Bank Ltd., Jaipur vs. Income Tax Officer, Ward-2-1, Jaipur

In the result, the appeal is partly allowed

ITA 1075/JPR/2018[2012-13]Status: DisposedITAT Jaipur13 May 2019AY 2012-13

Bench: Us. In This Appeal, The Assessee Bank Has Taken The Following Grounds Of Appeal:-

For Appellant: Shri Dilip Shivpuri (Adv.)For Respondent: Shri K.C. Meena (ACIT)
Section 145Section 234ASection 36(1)(viia)Section 36(1)(viii)Section 37(1)

…e case of CIT vs Bank of Baroda (262 ITR 334) wherein the Hon'ble Court held that loss debited to Profit & Loss account due to decrease in value of securities is allowable as deduction and the Hon'ble Supreme Court in the case of United Commercial Bank vs VIT 240 ITR 355 where the Hon'ble Court reversing the decision of the High Court held that Nationalised bank governed by Banking Regulation Act. Bank is following mercantile system of accounting both for book keeping as well as tax purposes. Bank is valuing stock in trade (investments) 'at cost' in balance sheet in accordance with Banking Regulation Act and valu…

ACIT, New Delhi vs. M/S Punjab National Bank, New Delhi

In the result, the appeal of the revenue in ITA No

ITA 1810/DEL/2016[2012-13]Status: DisposedITAT Delhi08 Apr 2019AY 2012-13

Bench: Shri N. K. Billaiya & Shri K. N. Chary[Assessment Year: 2012-13] The A.C.I.T. Vs. Punjab National Bank Circle – 20(1) Head Office, Finance Division New Delhi 5, Sansad Marg, New Delhi Pan No. Aaacp 0165 G (Appellant) (Respondent)

For Appellant: Smt. Sulekha Verma, CIT-DRFor Respondent: Shri S. Krishnan, CA

…“26. We have gone through the record and perused the order dated 16/03/2018 in ITA No. 4241/Del/2010 in assessee's own case, wherein after considering the case law on this aspect including the decision of the Hon'ble Apex Court in the case of UCO Bank vs. CIT 240 ITR 355 (SC) and the Master Circular of the RBI on the aspect of valuation of investments applicable to all banks prescribed in case of acquisition cost of securities classified under HTM category and also the order dated 25/10/2011 of a coordinate bench of this Tribunal in assessee's own case for the assessment year 2000-06 in ITA No. 2873/Del/2007, the…

Deputy Commissioner of Income Tax, Pune vs. M/S. Pune Cantonment Sahakari Bank Ltd, Pune

In the result, both the appeals of Revenue are dismissed

ITA 435/PUN/2017[2007-08]Status: DisposedITAT Pune27 Mar 2019AY 2007-08

Bench: Shri Anil Chaturvedi, Am & Shri Partha Sarathi Chaudhury, Jm

For Appellant: Shri Dhiraj DandgavelFor Respondent: Shri Abhijit Haldar
Section 145Section 148Section 154Section 36(1)(viia)Section 43D

…ently, debiting disallowance of Rs.11,82,35,007 ?" 8. This Court, in answering the aforesaid question of law in favour of the Assessee and placing reliance on the judgment of the Supreme Court in the case of United Commercial Bank v/s CIT, reported in (1999) 240 ITR 355(SC) held as under :- "In our view, the judgment of the Supreme Court in United Commercial Bank's case (1999) 240 ITR 355 squarely applies to the facts of this case. In fact, the present case before us is on a stronger footing because in the case of United Commercial Bank, the loss was not debited to the profit and loss account whereas in this c…

The Addl. CIT, Range-1, Ahmedabad vs. M/S. Adani Enterprises Ltd., Ahmedabad

In the result, the appeal of the Assessing Officer for the assessment year 2010-11 is dismissed

ITA 2531/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad12 Feb 2019AY 2010-11
Section 143(3)Section 14ASection 3

…credit before it is actually received; it brings into debit an expenditure for which a legal liability has been incurred before it is actually disbursed. (See judgment of this Court in the case of United Commercial Bank v. CIT (1999) 156 CTR (SC) 380 : (1999) 240 ITR 355 (SC). Therefore, the accounting method followed by an assessee continuously for a given period of time needs to be presumed to be correct till the AO comes to the conclusion for reasons to be given that the system does not reflect true and correct profits. As stated, there is no finding given by the AO on the correctness ITA Nos.: 1840/Ahd/12, 3…