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“Section 36(1)”

Section References (mined)Section 36Section 36(1)3,872 judgments

The decision most relied on for Section 36(1) is CIT v. Reliance Utilities & Power Ltd. (313 ITR 340), cited in 2,118 judgments on BharatTax.

Leading authorities on Section 36(1)

CIT v. Reliance Utilities & Power Ltd.
313 ITR 340 · 2009 · High Court
2,118
citing judgments

Where an assessee claims that investments were made out of own funds, interest disallowance under Section 14A read with Rule 8D may not apply if the assessee demonstrates the availability of sufficient interest-free funds to cover such investments.

CIT v. AIMIL Ltd.
321 ITR 508 · 2010 · High Court
1,629
citing judgments

Employee contributions to PF and ESIC, deposited beyond the due date under the respective Acts but within the due date for filing the income tax return under Section 139(1), are allowable deductions under Section 36(1)(va). Such disallowance cannot be made during processing under Section 143(1).

S.A. Builders Ltd. v. CIT
288 ITR 1 · 2007 · Supreme Court
1,484
citing judgments

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.

Checkmate Services Pvt. Ltd. v. CIT
143 Taxmann.com 178 · 2022 · Supreme Court
1,392
citing judgments

Employee contributions to provident fund and ESI deposited by an employer beyond the due dates prescribed under the respective special Acts are not allowable as a deduction under section 36(1)(va) of the Income-tax Act, 1961. Such disallowance can be made during processing under section 143(1).

CIT v. Alom Extrusions Ltd.
319 ITR 306 · 2009 · Supreme Court
1,344
citing judgments

A proviso inserted into a section to remedy unintended consequences, make the section workable, or supply an obvious omission must be read retrospectively in operation to give effect to the section as a whole.

CIT v. HDFC Bank Ltd.
366 ITR 505 · 2014 · High Court
1,261
citing judgments

When an assessee possesses interest-free funds sufficient to cover investments yielding tax-free income, it is presumed that such investments were made from these interest-free funds, precluding disallowance of interest expenditure under Section 14A.

CIT v. Gujarat State Road Transport Corporation
366 ITR 170 · 2014 · High Court
1,158
citing judgments

Employees' contributions to welfare funds, such as provident fund, are not allowable as a deduction under section 36(1)(va) if deposited beyond the due date prescribed under the respective welfare statutes, even by a single day. Such delayed deposits are not cured even if made before the income-tax return filing due date.

TRF Ltd. v. CIT
323 ITR 397 · 2010 · Supreme Court
714
citing judgments

For claiming deduction for bad debts under section 36(1)(vii) of the Income Tax Act, it is sufficient for the assessee to write off the debt as irrecoverable in its accounts, and it is not necessary to prove that the debt has actually become irrecoverable.

Judgments citing Section 36(1)

Bharath Yuva Sankshema Sangham, Eluru vs. Income-Tax Officer, Eluru

In the result, appeal filed by the assessee is allowed

ITA 160/VIZ/2025[2018-19]Status: DisposedITAT Visakhapatnam29 Aug 2025AY 2018-19

Bench: Shri Ravish Sood, Hon’Ble & Shri S Balakrishnan, Hon’Bleआईटीए. नं. / Ita No. 160/Viz/2025 निर्धारणवर्ा/ Assessment Year:2018-19) Bharath Yuva Sankshema Sangham V. Income Tax Officer 20B-7-21/1 Income Tax Office C/O. Ayyappa Medicals Eluru, West Godavari Andhra Pradesh Gandhi Nagar, Eluru West Godavari District – 534002 Andhra Pradesh [Pan:Aidpg1046K] (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) करदाता का प्रतततितित्व/ Assessee Represented By : Shri C. Subrahmanyam राजस्व का प्रतततितित्व/ Department Represented By : Dr. Aparna Villuri, Sr.Ar

Section 143(1)Section 143(2)Section 143(3)Section 154Section 250

Income Tax Rules. 3. While sustaining the addition of Rs.42,19,631/-, the Learned CIT(A) erred in applying the provisions of section 36(1)(va) and section 43B of the IT Act, 1961, which are not relevant to the present case since the issue before him was regarding Rule ... disallowance, relying on Rule 87 of Income Tax Rules, 1962. The Ld.CIT(A) also erroneously confirmed the addition by considering the provisions of section 36(1)(va) r.w.s. 2(24)(x) of the Act, while observing assessee has delayed in remitting the PF/ESI. The Ld.AR further submitted that the issue

Peoples University, Bhopal vs. Addl./Joint Commissioner of Income Tax (Appeals)-2, Mumbai

The appeal of the assessee is allowed for statistical purpose

ITA 4/IND/2025[2015-16]Status: DisposedITAT Indore29 Aug 2025AY 2015-16

Bench: Shri Bhagirath Mal Biyani & Shri Paresh M. Joshi

Section 11Section 12ASection 144Section 246ASection 250Section 253Section 57

आयकर अपीलीय अिधकरण, इंदौर "ायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI BHAGIRATH MAL BIYANI

Peoples University, Bhopal vs. Addl./ Joint Commissioner of Income-Tax (Appeals)-2, Mumbai

The appeal of the assessee is allowed for statistical purpose

ITA 3/IND/2025[2016-17]Status: DisposedITAT Indore29 Aug 2025AY 2016-17

Bench: Shri Bhagirath Mal Biyani & Shri Paresh M. Joshi

Section 11Section 12ASection 144Section 246ASection 250Section 253Section 57

आयकर अपीलीय अिधकरण, इंदौर "ायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI BHAGIRATH MAL BIYANI

Arvee Electricals & Engineering P Ltd., Pune vs. Deputy Commissioner of Income-Tax, Circle -1(1), Pune

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

ITA 24/PUN/2023[2018-19]Status: DisposedITAT Pune29 Aug 2025AY 2018-19

Bench: Dr.Dipak P. Ripote & Shri Vinay Bhamore

Section 143(1)Section 250Section 36(1)(va)

company for A.Y. 2018-19, we had reported the amounts of monthly payments w.r.t. contribution to provident fund and ESI referred to in section 36(1)(va), in clause 20(b) of the form 3CD for A.Y. 2018-19. However, while filling the online form 3CD there were typographical errors

Paalar Shoes Pvt. Ltd., Chennai vs. ACIT, Central Circle-1(1), Chennai

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

ITA 1640/CHNY/2025[2019-20]Status: DisposedITAT Chennai28 Aug 2025AY 2019-20

Bench: Shri S.S. Viswanethra Ravi & Shri S.R. Raghunathaआयकर अपील सं./I.T.A. No.1640/Chny/2025 िनधा"रण वष"/Assessment Year: 2019-20 Paalar Shoes Private Limited, Vs. The Assistant Commissioner Of No. 151/4, Mount Poonamalee Road, Income Tax, Ramapuram, Chennai 600 089. Central Circle 1(1), Chennai. [Pan:Aaecp6556B] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri D. Anand, Advocate ""थ" की ओर से/Respondent By : Shri N. Rajakumar, Addl. Cit सुनवाई की तारीख/ Date Of Hearing : 25.08.2025 घोषणा की तारीख /Date Of Pronouncement : 28.08.2025 आदेश /O R D E R Per S.S. Viswanethra Ravi: This Appeal Filed By The Assessee Is Directed Against The Order Dated 15.05.2025 Passed By The Ld. Commissioner Of Income Tax (Appeals) – 18, Chennai, For The Assessment Year 2019-20. 2. The Assessee Raised 4 Grounds Of Appeal Amongst Which, The Only Issue Emanates For Our Consideration As To Whether The Ld. Cit(A) Is Justified In Confirming The Addition Made By The Assessing Officer Under Section 36(1)(Va) Of The Income Tax Act, 1961 [“Act” In Short].

For Appellant: Shri D. Anand, AdvocateFor Respondent: Shri N. Rajakumar, Addl. CIT
Section 147Section 36(1)(va)

emanates for our consideration as to whether the ld. CIT(A) is justified in confirming the addition made by the Assessing Officer under section 36(1)(va) of the Income Tax Act, 1961 [“Act” in short]. 2 I.T.A. No.1640/Chny/25 3. At the outset, the ld. AR Shri D. Anand, Advocate ... submits that the assessment made under section 147 of the Act is not maintainable in respect of the addition made under section 36(1)(va) of the Act as the same issue attained finality by the order of the ld. CIT(A) in the first round of appellate proceedings

Shivalik Ventures Private Limited, Mumbai vs. DCIT CC 8(1), Mumbai

ITA 1444/MUM/2025[2020-2021]Status: DisposedITAT Mumbai28 Aug 2025AY 2020-2021

Bench: Ms Padmavathy S, Am & Shri Sandeep Singh Karhail, Jm

Section 133ASection 143(1)Section 143(3)Section 147Section 148Section 148ASection 194Section 250Section 40

subject matter of section 148A(b) notice and order under section 148A(d). The ld. AR further submitted that the disallowance made under section 36(1)(va) could have been made only by invoking explanation and not under the main provisions of section 147. Accordingly it is argued that when ... addition made under main provisions are deleted then the disallowance under section 36(1)(va) which is done under explanation cannot be sustained since the explanation cannot go beyond the jurisdiction of main section. The ld AR in this regard drew our attention to the following observations

Shivalik Ventures Private Limited, Mumbai vs. ACIT CC 8(1), Mumbai

ITA 1443/MUM/2025[2019-2020]Status: DisposedITAT Mumbai28 Aug 2025AY 2019-2020

Bench: Ms Padmavathy S, Am & Shri Sandeep Singh Karhail, Jm

Section 133ASection 143(1)Section 143(3)Section 147Section 148Section 148ASection 194Section 250Section 40

subject matter of section 148A(b) notice and order under section 148A(d). The ld. AR further submitted that the disallowance made under section 36(1)(va) could have been made only by invoking explanation and not under the main provisions of section 147. Accordingly it is argued that when ... addition made under main provisions are deleted then the disallowance under section 36(1)(va) which is done under explanation cannot be sustained since the explanation cannot go beyond the jurisdiction of main section. The ld AR in this regard drew our attention to the following observations

Shivalik Ventures Private Limited, Mumbai vs. ACIT CC 8(1), Mumbai

ITA 1442/MUM/2025[2018-2019]Status: DisposedITAT Mumbai28 Aug 2025AY 2018-2019

Bench: Ms Padmavathy S, Am & Shri Sandeep Singh Karhail, Jm

For Respondent: Shri Arun Kanti Datta, CIT-DR
Section 133ASection 143(1)Section 143(3)Section 147Section 148Section 148ASection 194ISection 250Section 40

subject matter of section 148A(b) notice and order under section 148A(d). The ld. AR further submitted that the disallowance made under section 36(1)(va) could have been made only by invoking explanation and not under the main provisions of section 147. Accordingly it is argued that when ... addition made under main provisions are deleted then the disallowance under section 36(1)(va) which is done under explanation cannot be sustained since the explanation cannot go beyond the jurisdiction of main section. The ld AR in this regard drew our attention to the following observations

Assistant Commissioner of Income Tax, Circle-2, Kota vs. Chambal Fertilizers and Chemicals Ltd., Kota

56. As a result, as regards the issue of allowance/disallowance of

ITA 1099/JPR/2024[2016-17]Status: DisposedITAT Jaipur27 Aug 2025AY 2016-17
For Appellant: Shri P.J. Pardiwala, AdvFor Respondent: Shri Rajesh Ojha, CIT &
Section 14ASection 36(1)Section 36(1)(iii)

time, Appellate Tribunal had issued following directions to Learned CIT (A):- “The AO has made the disallowance of interest invoking the provisions of section 36(1) (iii) holding that the assessee had utilised the borrowed funds lying in its cash credit account for making the investment in subsidiary companies ... totally ignored the whole discussions and findings of the AO which have been rendered in the context of section 36(1)(iii) of the Act and has not given any findings as to why the provisions of section 36(1)(iii) are not attracted in the instant case. The ground

Assistant Commissioner of Income Tax, Circle-2, Kota vs. Chambal Fertilizers and Chemicals Ltd, Kota

56. As a result, as regards the issue of allowance/disallowance of

ITA 1098/JPR/2024[2015-16]Status: DisposedITAT Jaipur27 Aug 2025AY 2015-16
Section 14ASection 36(1)Section 36(1)(iii)

time, Appellate Tribunal had issued following directions to Learned CIT (A):- “The AO has made the disallowance of interest invoking the provisions of section 36(1) (iii) holding that the assessee had utilised the borrowed funds lying in its cash credit account for making the investment in subsidiary companies ... totally ignored the whole discussions and findings of the AO which have been rendered in the context of section 36(1)(iii) of the Act and has not given any findings as to why the provisions of section 36(1)(iii) are not attracted in the instant case. The ground

Assistant Commissioner of Income Tax, Circle-2, Kota vs. Chambal Fertilizers and Chemicals Ltd., Kota

ITA 1097/JPR/2024[2011-12]Status: DisposedITAT Jaipur27 Aug 2025AY 2011-12

Bench: SHRI GAGAN GOYAL (Accountant Member), SHRI NARINDER KUMAR (Judicial Member)

For Appellant: Shri P.J. Pardiwala, AdvFor Respondent: Shri Rajesh Ojha, CIT &
Section 14ASection 36(1)Section 36(1)(iii)

time, Appellate Tribunal had issued following directions to Learned CIT (A):- “The AO has made the disallowance of interest invoking the provisions of section 36(1) (iii) holding that the assessee had utilised the borrowed funds lying in its cash credit account for making the investment in subsidiary companies ... totally ignored the whole discussions and findings of the AO which have been rendered in the context of section 36(1)(iii) of the Act and has not given any findings as to why the provisions of section 36(1)(iii) are not attracted in the instant case. The ground

Assistant Commissioner of Income Tax, Circle-2, Kota vs. Chambal Fertilizers and Chemicals Ltd, Kota

ITA 1091/JPR/2024[2017-18]Status: DisposedITAT Jaipur27 Aug 2025AY 2017-18

Bench: SHRI GAGAN GOYAL (Accountant Member), SHRI NARINDER KUMAR (Judicial Member)

For Appellant: Shri P.J. Pardiwala, AdvFor Respondent: Shri Rajesh Ojha, CIT &
Section 14ASection 36(1)Section 36(1)(iii)

time, Appellate Tribunal had issued following directions to Learned CIT (A):- “The AO has made the disallowance of interest invoking the provisions of section 36(1) (iii) holding that the assessee had utilised the borrowed funds lying in its cash credit account for making the investment in subsidiary companies ... totally ignored the whole discussions and findings of the AO which have been rendered in the context of section 36(1)(iii) of the Act and has not given any findings as to why the provisions of section 36(1)(iii) are not attracted in the instant case. The ground

Assistant Commissioner of Income Tax, Circle-2, Kota vs. Chambal Fertilizers and Chemicals Ltd, Kota

ITA 1090/JPR/2024[2010-11]Status: DisposedITAT Jaipur27 Aug 2025AY 2010-11

Bench: SHRI GAGAN GOYAL (Accountant Member), SHRI NARINDER KUMAR (Judicial Member)

For Appellant: Shri P.J. Pardiwala, AdvFor Respondent: Shri Rajesh Ojha, CIT &
Section 14ASection 36(1)Section 36(1)(iii)

time, Appellate Tribunal had issued following directions to Learned CIT (A):- “The AO has made the disallowance of interest invoking the provisions of section 36(1) (iii) holding that the assessee had utilised the borrowed funds lying in its cash credit account for making the investment in subsidiary companies ... totally ignored the whole discussions and findings of the AO which have been rendered in the context of section 36(1)(iii) of the Act and has not given any findings as to why the provisions of section 36(1)(iii) are not attracted in the instant case. The ground

Ma Shanti Agro Foods Pvt. Ltd., Birbhum vs. ACIT, CC 2(1), Kolkata

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

ITA 570/KOL/2025[2021-22]Status: DisposedITAT Kolkata27 Aug 2025AY 2021-22

Bench: Shri George Mathan & Shri Rakesh Mishra

Section 115BSection 143(1)Section 154Section 250Section 36(1)

Circumstance of the case and material brought on record, the Ld. CIT (A) erred in confirming the addition of Rs. 20684.00 by invoking section 36(1) (va) of the I.T. Act, Act, 1961, made by Ld. Assessing Officer, Central Processing Centre 3 The appellant craves leave to add further grounds

Ravinder Kumar Jha, Ghaziabad vs. The Accessing Officer, Ward- 2(2)(2), Ghaziabad

In the result, appeal of the assessee is dismissed

ITA 4179/DEL/2025[2020-21]Status: DisposedITAT Delhi27 Aug 2025AY 2020-21

Bench: Shri M. Balaganeshsh. Ravinder Kumar Jha, Vs. The Assessing Officer, 1039, Near Old Magnum Ward-2(2), Ghaziabad Paper Mill Karkar, Jhandapur, Sahibabad, Ghaziabad, Up, 201010, India Pan: Aippj0007P Assessee By : None Revenue By: Shri Manoj Kumar, Sr. Dr Date Of Hearing 13/08/2025 Date Of Pronouncement 27/08/2025

For Appellant: NoneFor Respondent: Shri Manoj Kumar, Sr. DR
Section 143(1)Section 2(24)(x)Section 36(1)(iv)Section 36(1)(va)Section 43B

revenue by observing as under:- “53. The distinction between an employer’s contribution which is its primary liability under law – in terms of Section 36(1)(iv), and its liability to deposit amounts received by it or deducted by it (Section 36(1)(va)) is, thus crucial. The former forms ... later retains its character as an income (albeit deemed), by virtue of Section 2(24)(x) - unless the conditions spelt by Explanation to Section 36(1)(va) are satisfied i.e., depositing such amount received or deducted from the employee on or before the due date. In other words, there

Manglayatan Projects P.Ltd, New Delhi vs. Addl.CIT, Special Range-4, New Delhi

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

ITA 5527/DEL/2018[2014-15]Status: DisposedITAT Delhi27 Aug 2025AY 2014-15

Bench: Shri Anubhav Sharma & Shri Krinwant Sahay, Accoutant Member Asstt. Year : 2014-15 Manglayatan Projects Pvt. Ltd., Vs. Addl. Cit, Special Range-04, A-86, Gali No. 9, New Delhi Chander Vihar, Mandawali, New Delhi (Pan: Aaicm3804H) (Appellant) (Respondent) Appellant By : Sh. Prateek Mittal, Ca Respondent By : Ms. Harpreet Kaur Hansra, Sr. Dr. Date Of Hearing 20.08.2025 Date Of Pronouncement 27.08.2025 Order

For Appellant: Sh. Prateek Mittal, CAFor Respondent: Ms. Harpreet Kaur Hansra, SR. DR
Section 131Section 143(3)Section 14ASection 36(1)(iii)Section 68

erred on facts and in law in upholding the action of AO in incorrectly invoking the provisions of Section 36(1)(iii) of the Income tax Act, 1961 and making the addition of Rs. 2,20,500/- although the appellant had sufficient capital and other non-interest bearing funds ... given to the group concerns out of commercial expediency, hence the interest paid is required to be allowed in view of provisions of section 36(1)(iii) of the I.T. Act. The Ld. AR has submitted that that the overall loan given out to M/s Parayas Infosolutions

Bank of Baroda, Mumbai vs. Assistant Commissioner of Income Tax, Circle 2(1)(1), Mumbai

The appeals of the appellant are partly allowed for statistical purposes

ITA 2392/MUM/2025[2020-21]Status: DisposedITAT Mumbai26 Aug 2025AY 2020-21

Bench: Shri Narender Kumar Choudhry (Jm) & Shri Omkareshwar Chidara (Am)

For Appellant: Shri Leyaqat Ali AafaquiFor Respondent: Shri C. Naresh
Section 143(3)Section 90(3)

ITAT of A.Y. 2016-17, this ground of appellant bank is dismissed. 4. The third issue relates to restriction of deduction under section 36(1)(viii) of the Act by the Ld. AO in his assessment order. The Ld. AR of the 5 Bank of Baroda appellant has stated that ... accepted by Ld. AO disregarding the fact that the assessee did not create special reserve to that extent as per the requirement of Section 36(1)(viii). Failure on the part of Ld. AO to consider the same, in the opinion of Ld. Pr.CIT, has rendered the order erroneous

Bank of Baroda, Mumbai vs. Assistant Commissioner of Income Tax, Circle 2(1)(1), Mumbai

The appeals of the appellant are partly allowed for statistical purposes

ITA 1243/MUM/2025[2018-19]Status: DisposedITAT Mumbai26 Aug 2025AY 2018-19

Bench: Shri Narender Kumar Choudhry (Jm) & Shri Omkareshwar Chidara (Am)

For Appellant: Shri Leyaqat Ali AafaquiFor Respondent: Shri C. Naresh
Section 143(3)Section 90(3)

ITAT of A.Y. 2016-17, this ground of appellant bank is dismissed. 4. The third issue relates to restriction of deduction under section 36(1)(viii) of the Act by the Ld. AO in his assessment order. The Ld. AR of the 5 Bank of Baroda appellant has stated that ... accepted by Ld. AO disregarding the fact that the assessee did not create special reserve to that extent as per the requirement of Section 36(1)(viii). Failure on the part of Ld. AO to consider the same, in the opinion of Ld. Pr.CIT, has rendered the order erroneous

Bank of Baroda, Mumbai vs. Assistant Commissioner of Income Tax, Circle 2(1)(1), Mumbai

The appeals of the appellant are partly allowed for statistical purposes

ITA 1241/MUM/2025[2019-20]Status: DisposedITAT Mumbai26 Aug 2025AY 2019-20

Bench: Shri Narender Kumar Choudhry (Jm) & Shri Omkareshwar Chidara (Am)

For Appellant: Shri Leyaqat Ali AafaquiFor Respondent: Shri C. Naresh
Section 143(3)Section 90(3)

ITAT of A.Y. 2016-17, this ground of appellant bank is dismissed. 4. The third issue relates to restriction of deduction under section 36(1)(viii) of the Act by the Ld. AO in his assessment order. The Ld. AR of the 5 Bank of Baroda appellant has stated that ... accepted by Ld. AO disregarding the fact that the assessee did not create special reserve to that extent as per the requirement of Section 36(1)(viii). Failure on the part of Ld. AO to consider the same, in the opinion of Ld. Pr.CIT, has rendered the order erroneous

G R N Finsec Private Limited, Mumbai vs. Assistant Commissioner of Income Tax, Mumbai

In the result, the appeal filed by the assessee in ITA No

ITA 5341/MUM/2024[2016-17]Status: DisposedITAT Mumbai26 Aug 2025AY 2016-17

Bench: Shri Vikram Singh Yadav & Shri Sandeep Gosain

For Appellant: Shri Madhur Agrawal &For Respondent: Shri Swapnil Choudhary
Section 143(3)Section 14ASection 36(1)Section 36(1)(iii)

funds to make such investments during the year to the tune of Rs 39,62,500/- and no disallowance is called for under section 36(1)(iii) of the Act. In the result, ground of appeal is allowed. 10. Regarding Grounds No. 2 to 6, it was submitted that