“Section 36(1)(viii)”

Section References (mined)Section 36Section 36(1)(viii)285 judgments

The decision most relied on for Section 36(1)(viii) is Maxopp Investment Ltd. v. CIT (347 ITR 272), cited in 516 judgments on BharatTax.

Leading authorities on Section 36(1)(viii)

Maxopp Investment Ltd. v. CIT

347 ITR 272 · 2012 · High Court

516

citing judgments

Disallowance under Section 14A cannot exceed the exempt income earned. The Assessing Officer must record satisfaction regarding the assessee's accounts before making any disallowance.

Catholic Syrian Bank Ltd. v. CIT

343 ITR 270 · 2012 · Supreme Court

326

citing judgments

For a bad debt deduction under Section 36(1)(vii), the debt must be actually written off as irrecoverable in the assessee's accounts, distinct from merely making a provision for bad and doubtful debts. The assessee bears the onus to satisfy the conditions under both Section 36(1)(vii) and Section 36(2) of the Income-tax Act.

United Commercial Bank v. CIT

240 ITR 355 · 1999 · Supreme Court

314

citing judgments

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.

CIT v. Essar Tele

401 ITR 445 · 2018 · Supreme Court

198

citing judgments

Rule 8D of the Income Tax Rules, read with Section 14A, applies prospectively. It cannot be applied to any assessment year prior to Assessment Year 2008-09.

Bharat Commerce Industries Ltd. v. CIT

230 ITR 733 · 1998 · Supreme Court

130

citing judgments

The Supreme Court holds that interest paid under Section 201(1A) of the Income-tax Act, for failure to deduct tax at source, is not an allowable business expenditure under Section 37(1) of the Act.

UCO Bank, Calcutta v. Commissioner of Income Tax, W.B

4 SCC 599 · 1999 · Reported

122

citing judgments

Circulars and instructions issued by the Central Board of Direct Taxes (CBDT) under Section 119 of the Income Tax Act have the force of law and are binding on all income tax authorities. These circulars can mitigate the rigour of statutory provisions, provide administrative relief, and ensure uniform application of the Act for the benefit of the assessee.

Raj Dadarkar & Associates v. ACIT

394 ITR 592 · 2017 · Supreme Court

107

citing judgments

The object clause in a partnership deed is not determinative of the head under which rental income is to be assessed; income from letting out shops and stalls developed by the assessee may still be classified as 'Income from House Property' rather than 'Profits and Gains of Business'.

Godrej & Boyce Mfg. Co. Ltd. v. DCIT, Range10(2), Mumbai

234 CTR 1 · 2010 · High Court

citing judgments

Expenditure incurred by an assessee in relation to income not forming part of the total income is not deductible under Section 14A(1). The disallowance must be restricted to direct and indirect expenses having an approximate connection with the earning of such exempt income, and Rule 8D applies from Assessment Year 2008-09.

Judgments citing Section 36(1)(viii)

M/S. ACIT 2(3), Mumbai vs. Raymond Ltd., Mumbai

In the result, appeal filed by the Revenue is partly allowed

ITA 2519/MUM/2008[2002-2003]Status: DisposedITAT Mumbai14 Nov 2022AY 2002-2003

Bench: Shri Vikas Awasthy, Hon'Ble & Shri S. Rifaur Rahman, Hon'Blem/S. Raymond Limited V. Addl. Cit– Range 2(3) New Hind House 5Th Floor, Aayakar Bhavan Narottam Morarjee Marg M.K. Road, Mumbai - 400020 Ballard Estate, Mumbai - 400001 Pan: Aaacr4896A (Appellant) (Respondent) Acit–2(3) V. M/S. Raymond Limited Room No. 555 New Hind House Aayakar Bhavan, Mumbai Narottam Morarjee Marg Ballard Estate, Mumbai - 400001 Pan: Aaacr4896A (Appellant) (Respondent)

For Appellant: Shri Nitesh Joshi &For Respondent: Shri Samuel Pitta

Section 115JSection 14ASection 35DSection 92C

issue was considered by the Hon'ble High Court and decided the issue in its favour. 27. Further, he brought to our notice section 36(1)(viii) to submit that amount of any bad debt or part thereof which is written off as irrecoverable in the accounts of the assessee

Kokan Mercantila Co Op Bank Ltd, Mumbai vs. ACIT Circle-20(2), Mumbai

In the result we set aside the orders of authorities below and direct to allow the deduction u/s

ITA 651/MUM/2022[2017-18]Status: DisposedITAT Mumbai04 Oct 2022AY 2017-18

Bench: Shri Kuldip Singh & Shri Gagan Goyalkokan Mercantile Co-Operative Bank Ltd. Harbour Crest, 1St Floor, Mazagaon, Mumbai-400010. Pan: Aaaak2527P ...... Appellant Vs. Acit, Circle-20(2), Room No. 217, 2Nd Floor, Piramal Chambers, Lalbaug, Parel, Mumbai-400012 ..... Respondent Appellant By : Sh. M. Subramanian, Adv. Respondent By : Sh. Tejinder Pal Singh, Sr.Dr Date Of Hearing : 12/07/2022 Date Of Pronouncement : 04/10/2022 Order Per Gagan Goyal, A.M: This Appeal By The Assessee Is Directed Against The Order Of National Faceless Appeal Centre, Delhi [Hereinafter Referred To As [‘Nfac’] Dated 21.12.2021 Passed Under Section 250 Of The Income Tax Act, 1961 (Hereinafter Referred To As [‘The Act’] For The Assessment Year (Ay) 2017-18. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: Sh. M. Subramanian, AdvFor Respondent: Sh. Tejinder Pal Singh, Sr.DR

Section 142(1)Section 143(2)Section 234BSection 234CSection 250Section 36(1)

scheduled bank duly licensed and governed by the provisions and norms of R.B.I announced from time to time. 6. Assessee claimed deduction under section 36(1) (viii) and AO treated this claim under section 36(1) (viia). Both are distinct sections, and both can operate simultaneously. Once it is proved ... business, assessee’s claim under 36(1) (viii) can’t be neither denied nor the character of the claim can be interchanged from section 36(1) (viii) to section 36(1) (viia) of the Act. 9 ITA No. 651/Mum/2022-Kokan Mercantile Co-operative Bank Ltd. 7. In support of our view

Addl CIT RG 10(1), Mumbai vs. Infrastructure Leasing & Financial Services Ltd, Mumbai

In the result, the appeal of the Revenue is dismissed

ITA 2841/MUM/2011[2005-06]Status: DisposedITAT Mumbai27 Jul 2022AY 2005-06

Bench: Shri Amarjit Singh & Ms. Kavitha Rajagopalassessment Years: 2005-06 Asst. Commissioner Of Income M/S. Infrastructure Leasing & Tax, Financial Services Ltd., Range – 10(1), The Il & Fs Financial Centre, Room No.455, Vs. Plot No.C-22, G Block, Aayakar Bhavan, Bandra Kurla Complex, Mk Road, Bandra (E), Mumbai – 400 020 Mumbai – 400 051 Pan: Aaaci 0989F (Appellant) (Respondent) Present For: Assessee By : None Revenue By : Shri Dharm Veer Singh, D.R. Date Of Hearing : 18 . 07 . 2022 Date Of Pronouncement : 27. 07 . 2022 O R D E R Per Amarjit Singh: The Appeal Of The Revenue For Assessment Year 2005-06 Vide Ita No.2841/M/2011 Was Adjudicated On 30.04.2019. Subsequently, The Revenue Has Filed Miscellaneous Application Stating That While Adjudicating The Aforesaid Appeal Ground No.2, Ground No.9 & Ground No.10 Pertaining To Disallowance Of Bad Debt, Claim Of Deduction Under Section 36(1)(Vii) Of The Act & Disallowance Out Of Travelling & Conveyance Expenses Were Not Adjudicated. Therefore The Appeal Of The Revenue Was Recalled By Ma No.571/M/2019 Order Dated 20.01.2020 To Adjudicate The Aforesaid Three Grounds Of The Revenue. The Relevant Facts Pertaining To These Three Grounds Of Appeal Are Discussed While Adjudicating The Same As Under:

For Appellant: NoneFor Respondent: Shri Dharm Veer Singh, D.R

Section 36(1)(vii)Section 36(1)(viii)

decision of the Ld. CIT(A), therefore ground of appeal of the Revenue stands dismissed. Ground No.9 “Disallowance of Rs.39,83,335/- under section 36(1)(viii) of the Act” 6. Heard both the sides and perused the material on record. 7. During the course of assessment the assessee claimed ... deduction under section 36(1)(viii) of the Act. As per provisions of section 36(1)(viii) of the Act deduction @ 40% was available on profit derived from the eligible business i.e. providing long term finance for development of infrastructure facilities in India. The assessee’s working of deduction

Icici Home Finance Company Ltd, Mumbai vs. Addl CIT 10(1), Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 1325/MUM/2013[2009-10]Status: DisposedITAT Mumbai03 Jun 2022AY 2009-10

Bench: Shri Vikas Awasthy, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Aarti VissanjiFor Respondent: R.A. Dhyani

Section 14ASection 201Section 250Section 36(1)(viii)Section 36(1)(viil)Section 37(1)

Members directed the Appellants to file a note on ground no. 4 of appellant's appeal on claim for deduction under section 36(1)(viii) of the Income Tax Act, 1961 (the 'Act') on interest income earned from securitization trust. Accordingly, the Appellants submit the following: 1. The appellant being ... business of providing housing loans to the customers. Since the appellant is a "housing finance company", it is eligible for deduction under section 36(1)(viii) of the Act for the income earned from housing finance business. 2. The appellant earns interest income from the securitization trust ('the trust') based

ACIT 1(1) (1), Mumbai vs. M/S. Hindustan Development Finance Corporation Ltd, Mumbai

In the result, appeal is dismissed

ITA 2415/MUM/2021[2008-09]Status: DisposedITAT Mumbai20 May 2022AY 2008-09

Bench: Shri Aby T. Varkey () & Shri Gagan Goyal ()

Section 143(3)Section 263Section 36(1)(viii)

accordingly, the assessment order was set aside on 22.03.2013 with a direction to the Assessing Officer to allow the correct deduction under section 36(1)(viii) of the Act after examining the issues raised by him thoroughly and taking into consideration the facts that interest received by the assessee under

Joint Commissioner of Income Tax, Ltu, Bengaluru vs. M/S. Vijaya Bank, Bengaluru

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

ITA 1834/BANG/2018[2014-15]Status: DisposedITAT Bangalore11 Mar 2022AY 2014-15

Bench: Shri George George K & Ms. Padmavathy Sassessment Year : 2014-15

For Appellant: Shri Ananthan, C.A &For Respondent: Shri Pradeep Kumar, CIT(DR)

Section 115JSection 143(3)Section 234DSection 36(1)(vii)Section 36(1)(viia)Section 36(2)(v)Section 37(1)(vii)

computed under the head 'Profits & gains of business or profession" (before making any deduction under its clause) carried to such reserve account" 22. Section 36(1)(viii) envisages a transfer to a special reserve inorder to claim deduction under the said section. The issues to be considered here ... where the Tribunal has held that “53. It is the contention of the assessee before us that as per the provisions of section 36(1)(viii) assessee is eligible for ITA Nos.1834/Bang/2018 & 1839/Bang/2018 Page 15 of 41 deduction for an amount of 79,39,000 whereas deduction to the extent

Icici Bank Ltd., Mumbai vs. The Dy CIT -2(3)(1), Mumbai

In the result we hold that the learned principal

ITA 737/MUM/2021[2011-12]Status: DisposedITAT Mumbai08 Mar 2022AY 2011-12

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm Icici Bank Limited The Dy. Commissioner Of Icici Bank Towers, Income-Tax-2(3)(1), Aayakar Bhavan, 5 Th Floor, Bandra Kurla Complex, Vs. Bandra (East), Room No.552, Mumbai-400 051 M.K.Road, Mumbai-400 020 (Appellant) (Respondent) Pan No. Aaaci1195H Appellant By : Ms Arati Vissanji, Ar Respondent By : Shri Nikhil Chaudhary, Cit Dr Date Of Hearing: 13.01.2022 Date Of Pronouncement : 08.03.2022

For Appellant: Ms Arati Vissanji, ARFor Respondent: Shri Nikhil Chaudhary, CIT DR

Section 143(3)Section 147Section 263Section 263(1)Section 263(2)Section 36(1)(vii)Section 36(1)(viia)Section 36(1)(viii)

treated as bad debts and not as a business loss (b) Non disallowance of unpaid leave encashment (C) Deduction claimed under section 36(1)(viii) ICICI Bank Ltd.; AY 11-12 1.2 The Pr. CIT erred in not considering the alternative plea raised by the Appellant that revision ... erred in not considering the alternative plea raised by the Appellant that since the issue pertaining to deduction under section 36(1)(viii) of the Act is a subject matter of appeal before the CIT(A) 6, Mumbai filed by the Bank against the order under section 143(3) r.w.s

Addl. CIT, Special Range- 7, New Delhi vs. Pnb Housing Finance Ltd., New Delhi

In the result we do not find any merit in ground No

ITA 6352/DEL/2018[2015-16]Status: DisposedITAT Delhi14 Oct 2021AY 2015-16

Bench: Shri O.P. Kant & Shri Kuldip Singh[Through Video Conferencing] Assessment Year: 2015-16

Section 36Section 36(1)(vii)Section 36(1)(viii)

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘F’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER AND SHRI KULDIP

Addl. CIT, Special Range- 7, New Delhi vs. Pnb Housing Finance Ltd., New Delhi

In the result, the appeal of the Revenue is dismissed and the cross objection of the assessee is allowed for statistical purposes

ITA 5969/DEL/2017[2014-15]Status: DisposedITAT Delhi24 Aug 2021AY 2014-15

Bench: Shri R.K. Panda & Shri K. Narasimha Charyassessment Year: 2014-15

For Appellant: Sh. S. Krishnan, AdvocateFor Respondent: Sh. Farhat Khan, Sr. DR

Section 14ASection 36Section 36(1)(viii)

assessee was, however, determined by the Assessing Officer at Rs.1,50,83,94,920/-, after making addition of Rs.1,88,65,937/- under section 36(1)(viii) of the Income-tax Act, 1961 (“the Act”) on account of the amount transferred to special reserve and Rs.3

DCIT, Circle- 21(1), New Delhi vs. Religare Housing Development Finance Corporation Ltd., New Delhi

In the result, the appeals of the revenue are dismissed

ITA 7679/DEL/2017[2014-15]Status: DisposedITAT Delhi29 Jun 2021AY 2014-15

Bench: Ms. Suchitra Kambledr. B. R. R. Kumar(Through Video Conferencing) Ita No. 6433/Del/2017 : Asstt. Year : 2013-14 Ita No. 7679/Del/2017 : Asstt. Year : 2014-15 Dcit, Vs Religare Housing Development Circle-21(1), Finance Corporation Ltd.,D-3, P3B, New Delhi District Centre, Saket, New Delhi-110017 (Appellant) (Respondent) Pan No. Aaacm6533D Present Assessee By : Sh. Rohit Jain, Adv. Revenue By : Ms. Parmita M. Biswas, Cit Date Of Hearing: 17.06.2021 Date Of Pronouncement: 29.06.2021

For Appellant: Sh. Rohit Jain, AdvFor Respondent: Ms. Parmita M. Biswas, CIT

Section 36(1)Section 36(1)(viii)

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘F’, NEW DELHI Before Ms. Suchitra Kamble, Judicial Member Dr. B. R

DCIT, Circle- 21(1), New Delhi vs. Religare Housing Development Finance Corporation Ltd., New Delhi

In the result, the appeals of the revenue are dismissed

ITA 6433/DEL/2017[2013-14]Status: DisposedITAT Delhi29 Jun 2021AY 2013-14

For Appellant: Sh. Rohit Jain, AdvFor Respondent: Ms. Parmita M. Biswas, CIT

Section 36(1)Section 36(1)(viii)

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘F’, NEW DELHI Before Ms. Suchitra Kamble, Judicial Member Dr. B. R

ACIT, Circle- 1, Ltu, New Delhi vs. Power Finance Corporation Ltd., New Delhi

In the result, all these appeals are dismissed

ITA 1744/DEL/2018[2014-15]Status: DisposedITAT Delhi11 Mar 2021AY 2014-15

Bench: Shri Amit Shukla & Shri Anadee Nath Misshra

For Appellant: Ms. Aggarta Gupta, CAFor Respondent: Smt. Sushma Singh, CIT(DR)

erred both on facts and in law in partially confirming the action of the AO in restricting the deduction under section 36(1)(viii) to Rs. 308,76,66,619/- as against Rs.329,68,67,750/- claimed and allowable under the Act. (ii) On the facts and circumstances ... confirming the action of the AO in excluding upfront fees and management fees from the net total income while computing deduction under section 36(1)(viii) of the Income Tax Act. (iii) In the facts and circumstances the learned CIT(A) has erred both on facts