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“Section 37(1)”

Section References (mined)Section 37Section 37(1)4,308 judgments

The decision most relied on for Section 37(1) is CIT v. Reliance Utilities & Power Ltd. (313 ITR 340), cited in 2,118 judgments on BharatTax.

Leading authorities on Section 37(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.

Goetze (India) Ltd. v. CIT
284 ITR 323 · 2006 · Supreme Court
1,842
citing judgments

An assessee cannot raise a new claim or a claim not made in the original or revised return of income for the first time directly before the Assessing Officer during assessment proceedings.

Maxopp Investment Ltd. v. CIT
402 ITR 640 · 2018 · Supreme Court
1,596
citing judgments

Disallowance under Section 14A is not automatic and requires the Assessing Officer to record satisfaction before applying Rule 8D. Only investments yielding exempt income are considered for disallowance, irrespective of their strategic nature.

Cheminvest Ltd. v. CIT
378 ITR 33 · 2015 · High Court
1,569
citing judgments

A disallowance under Section 14A of the Income-tax Act, 1961, for expenditure incurred in relation to exempt income cannot be made if the assessee has not earned any exempt income during the relevant previous year.

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. 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.

Godrej & Boyce Mfg. Co. Ltd. v. DCIT
328 ITR 81 · 2010 · High Court
1,183
citing judgments

Rule 8D, for computing disallowance under Section 14A for expenses related to exempt income, applies from Assessment Year 2008-09 onwards; for prior years, a reasonable disallowance must be made. The disallowance under Section 14A cannot exceed the actual exempt income earned.

CIT v. Woodward Governor India Pvt. Ltd.
312 ITR 254 · 2009 · Supreme Court
968
citing judgments

Foreign exchange fluctuations, whether gains or losses, are inextricably linked to the underlying business transaction and must be accounted for under the mercantile system. The Supreme Court also affirmed the standard accounting principle of valuing stock at cost or net realisable value, whichever is lower.

Judgments citing Section 37(1)

Technocraft Industries (India) Limited, Mumbai vs. Asst. CIT 11(3)(1), Mumbai

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

ITA 7422/MUM/2025[2013-14]Status: DisposedITAT Mumbai03 Feb 2026AY 2013-14

Bench: Shri Anikesh Banerjee & Shri Makarand Vasant Mahadeokar

For Appellant: Shri Tarang Mehta, Adv. a/w Shri Akash GogariCAFor Respondent: Shri Ritesh Misra (CIT DR)
Section 143(3)Section 148Section 250Section 37

amount paid to M/s Shanti SevaNidhi of Rs.50 lakhs u/s 37(1) of the Income Tax Act, 1961. As per the Ld. AR, section 37(1) of the Income Tax Act, 1961 is a residuary section. Hence this section covers only those items of businessexpenditure which are not covered under ... reopening under section 148 of the Act and on merits regarding the disallowance of CSR expenditure of Rs.2.50 crore claimed under section 37(1) of the Act. On merits, it is an admitted fact that the assessee paid the said amount to SSN, which is engaged in imparting technical

ACIT, Mumbai vs. Raheja Universal Pvt Limited, Mumbai

ITA 5344/MUM/2025[2018-19]Status: DisposedITAT Mumbai03 Feb 2026AY 2018-19

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

Section 143(2)Section 143(3)Section 14ASection 14A(2)Section 36(2)

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI RAJ

Rashid Hussain, Hyderabad vs. ACIT., Central Circle-1(3), Hyderabad

ITA 1322/HYD/2025[2021-22]Status: DisposedITAT Hyderabad30 Jan 2026AY 2021-22

Bench: SHRI RAVISH SOOD, HON'BLE (Judicial Member), SHRI MADHUSUDAN SAWDIA HON'BLE (Accountant Member)

Section 143(2)Section 147Section 148Section 148ASection 151ASection 250Section 37(1)

आयकर अपील"य अ"धकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘SMC’ Bench, Hyderabad "ी रवीश सूद, माननीय

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

ITA 294/BANG/2025[2021-22]Status: DisposedITAT Bangalore30 Jan 2026AY 2021-22

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

IN THE INCOME TAX APPELLATE TRIBUNAL 'A' BENCH, BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K, JUDICIAL

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 293/BANG/2025[2020-21]Status: DisposedITAT Bangalore30 Jan 2026AY 2020-21

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

disallowance provisions of section 40(a)(ii) of the Act, the same should be allowed as a business expenditure under section 37(1) of the Act. 38.4 In support of this contention, reliance was placed on judicial precedents, including the decision of the ITAT Ahmedabad Bench in Mastek ... income and not an expenditure incurred for the purpose of carrying on business. Therefore, they are not allowable as a deduction under section 37(1) of the Act. The learned DR sought to distinguish the judicial precedents relied upon by the assessee by submitting that those decisions were rendered

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 292/BANG/2025[2019-20]Status: DisposedITAT Bangalore30 Jan 2026AY 2019-20

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

disallowance provisions of section 40(a)(ii) of the Act, the same should be allowed as a business expenditure under section 37(1) of the Act. 38.4 In support of this contention, reliance was placed on judicial precedents, including the decision of the ITAT Ahmedabad Bench in Mastek ... income and not an expenditure incurred for the purpose of carrying on business. Therefore, they are not allowable as a deduction under section 37(1) of the Act. The learned DR sought to distinguish the judicial precedents relied upon by the assessee by submitting that those decisions were rendered

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

ITA 291/BANG/2025[2018-19]Status: DisposedITAT Bangalore30 Jan 2026AY 2018-19

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

disallowance provisions of section 40(a)(ii) of the Act, the same should be allowed as a business expenditure under section 37(1) of the Act. 38.4 In support of this contention, reliance was placed on judicial precedents, including the decision of the ITAT Ahmedabad Bench in Mastek ... income and not an expenditure incurred for the purpose of carrying on business. Therefore, they are not allowable as a deduction under section 37(1) of the Act. The learned DR sought to distinguish the judicial precedents relied upon by the assessee by submitting that those decisions were rendered

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 290/BANG/2025[2017-18]Status: DisposedITAT Bangalore30 Jan 2026AY 2017-18

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

disallowance provisions of section 40(a)(ii) of the Act, the same should be allowed as a business expenditure under section 37(1) of the Act. 38.4 In support of this contention, reliance was placed on judicial precedents, including the decision of the ITAT Ahmedabad Bench in Mastek ... income and not an expenditure incurred for the purpose of carrying on business. Therefore, they are not allowable as a deduction under section 37(1) of the Act. The learned DR sought to distinguish the judicial precedents relied upon by the assessee by submitting that those decisions were rendered

Cisco Systems (India) Private Limited, Bangalore vs. The Principal Commissioner of Income Tax - 2, Koramangala, Bangalore

In the result, the appeal of the assessee is hereby dismissed

ITA 1234/BANG/2025[AY 2021-22]Status: DisposedITAT Bangalore30 Jan 2026

Bench: Shri Waseem Ahmed & Shri Soundararajan Kassessment Year: 2021-22

For Appellant: Shri Nageshwar Rao, AdvocateFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 143(3)Section 144BSection 263Section 37(1)

financial statements. Therefore, it has been stated that the claim of such expenses should have been examined and disallowed, if necessary, under section 37(1) of the Act. Page 3 of 19 7. The second issue raised in the notice pertains to the treatment of exchange gain amounting

Here Solutions India Private Limited, Mumbai vs. The Deputy Commissioner of Income Tax (Circle 4(2)(1), Mumbai)

In the result, appeal of the assessee is allowed

ITA 6658/MUM/2025[2022-2023]Status: DisposedITAT Mumbai30 Jan 2026AY 2022-2023

Bench: Smt. Beena Pillai & Shri Girish Agrawalassessment Year: 2022-23

For Appellant: Shri Ketan Ved, CAFor Respondent: Shri Pravin Salunkhe, Sr. DR
Section 144C(5)Section 37Section 37(1)Section 80GSection 80G(1)(i)Section 80G(5)

utilized for claiming deduction under section 80G of the Act. b. The Ld. AO/DRP erred in interpreting the provisions of Explanation 2 to section 37(1) of the Act which only bars deduction of CSR expenditure under section 37(1) of the Act and does not in any way restrict ... Undisputedly, expenditure incurred towards CSR is specifically prohibited from being allowed as deduction towards business expenditure by insertion of Explanation 2 to Section 37(1) of the Act by Finance Act, 2014 w.e.f01.04.2015. However, there is no such Ericsson India Global Services Pvt. Ltd. v. DCIT corresponding amendment to section

DCIT, Mumbai vs. Trent Limited, Mumbai

In the result, these grounds of appeal are

ITA 5242/MUM/2025[2014-15]Status: DisposedITAT Mumbai30 Jan 2026AY 2014-15

Bench: Shri Pawan Singh& Shri Girish Agrawal(Physical Hearing) Trent Limited Dcit-2(3)(1), Mumbai 552, 5Th Floor, Aayakar Bhavan, Bombay House, Mumbai, Vs Maharashtra – 400001. Maharishi Karve Road, [Pan: Aaacl1838J] Mumbai-400020. Appellant / Assessee Respondent / Revenue Dcit-2(3)(1), Mumbai Trent Limited 552, 5Th Floor, Aayakar Bhavan, Vs G Block, Plot No. C 60, Trent House, Maharishi Karve Road, Beside City Bank, Bandra K Complex, Mumbai-400020. Bandra E Mumbai – 400051. [Pan: Aaacl1838J] Appellant / Revenue Respondent / Assessee

Section 115JSection 143(3)Section 153Section 254(1)Section 40A(2)Section 92BSection 92C

equity fees is in the nature of capital expenditure leading to enduring benefit, and is therefore not allowable as a revenue expenditure under Section 37(1) of the Income-tax Act, 1961?" 6. "Whether on the facts and in law, the Ld. CIT(A) erred in deleting the disallowance ... Tribunal in Tata’s Group Companies, wherein similar brand equity fees is allowed by taking view that such expenditure is allowable expenditure under section 37(1). We find that ld. CIT(A) allowed relief to the assessee by following the decision of Tata Group cases, wherein similar brand equity brand

Trent Limited, Mumbai vs. Deputy Commissioner of Income Tax 2(3)(1), Mumbai

In the result, these grounds of appeal are

ITA 5166/MUM/2025[2014-15]Status: DisposedITAT Mumbai30 Jan 2026AY 2014-15

Bench: Shri Pawan Singh& Shri Girish Agrawal(Physical Hearing) Trent Limited Dcit-2(3)(1), Mumbai 552, 5Th Floor, Aayakar Bhavan, Bombay House, Mumbai, Vs Maharashtra – 400001. Maharishi Karve Road, [Pan: Aaacl1838J] Mumbai-400020. Appellant / Assessee Respondent / Revenue Dcit-2(3)(1), Mumbai Trent Limited 552, 5Th Floor, Aayakar Bhavan, Vs G Block, Plot No. C 60, Trent House, Maharishi Karve Road, Beside City Bank, Bandra K Complex, Mumbai-400020. Bandra E Mumbai – 400051. [Pan: Aaacl1838J] Appellant / Revenue Respondent / Assessee

Section 115JSection 143(3)Section 153Section 254(1)Section 40A(2)Section 92BSection 92C

equity fees is in the nature of capital expenditure leading to enduring benefit, and is therefore not allowable as a revenue expenditure under Section 37(1) of the Income-tax Act, 1961?" 6. "Whether on the facts and in law, the Ld. CIT(A) erred in deleting the disallowance ... Tribunal in Tata’s Group Companies, wherein similar brand equity fees is allowed by taking view that such expenditure is allowable expenditure under section 37(1). We find that ld. CIT(A) allowed relief to the assessee by following the decision of Tata Group cases, wherein similar brand equity brand

Deputy Commissioner of Income Tax 1(1)(2), Mumbai vs. Hindustan Unilever Limited, Mumbai

ITA 929/MUM/2018[2004-05]Status: DisposedITAT Mumbai30 Jan 2026AY 2004-05

Bench: Shri Om Prakash Kantshri Sandeep Singh Karhail

For Appellant: Shri Nishant ThakkarFor Respondent: Shri Ajay Chandra, CIT-DR
Section 10BSection 145ASection 14ASection 250Section 80Section 801BSection 80H

IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI SANDEEP SINGH KARHAIL

Hindustan Unilever Limited, Mumbai vs. Dy.CIT-1(1)(2), Mumbai

In the result, the appeal by the Revenue and cross-objection by the

ITA 1041/MUM/2018[2004-05]Status: DisposedITAT Mumbai30 Jan 2026AY 2004-05

Bench: Shri Om Prakash Kant

For Appellant: Shri Nishant ThakkarFor Respondent: Shri Ajay Chandra, CIT-DR
Section 10BSection 145ASection 14ASection 250Section 80Section 801BSection 80HSection 8O

IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI SANDEEP SINGH KARHAIL

Alaknanda Associates, Meerut vs. ITO Ward 1(1)(4), Meerut

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

ITA 5452/DEL/2025[2018-19]Status: DisposedITAT Delhi30 Jan 2026AY 2018-19

Bench: Shri S Rifaur Rahman & Shri Vimal Kumarassessment Year 2018-19 Ms. Alaknanda Associates, Vs. Income Tax Officer, 00, Shivam Complex, Ward-1(1)(4), Nateshpuram, Kanker-Khera, Meerut Meerut - 250001 Pan No. Aaofm3000C (Appellant) (Respondent)

For Appellant: Shri Raj Kumar Jain, AdvFor Respondent: Ms. Harpreet Kaur Hansra, Sr. DR
Section 143(1)Section 143(1)(a)Section 250Section 36Section 36(1)(va)Section 43B

plea that the belated deposit of employees contributions to PF/ESIC governed under Section 36(1)(va) is also simultaneously amenable to deduction under Section 37(1) of the Act. In terms of the provision, Section 37(1) permits deduction of expenditure which is not in the nature of expenditure prescribed ... personal expenses of the assessee. Thus, in view of such mandate of law, the deduction of expenditure under the general clause of Section 37(1) would not extend to expenditure specially covered within the ambit of Section 36(1)(va) of the Act. The Hon’ble Supreme Court

Vishnu Distributors R.F., Lucknow vs. I.T.O. 6(2), Pratyaksh Kar Bhawan, Lucknow

In the result, the appeal is partly allowed for statistical purposes

ITA 333/LKW/2025[2018-19]Status: DisposedITAT Lucknow29 Jan 2026AY 2018-19

Bench: Shri Anadee Nath Misshra

Section 253(3)Section 37(1)

I.T.A. No.333/Lkw/2025 Assessment Year:2018-19 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH ‘SMC’, LUCKNOW BEFORE SHRI ANADEE

Zydus Lifesciences Ltd., Ahmedabad vs. The Dy.CIT, Central Circle-2(1), Ahmedabad

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

ITA 392/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad29 Jan 2026AY 2017-18

Bench: SMT. ANNAPURNA GUPTA (Accountant Member), Ms. SUCHITRA KAMBLE (Judicial Member)

For Appellant: Shri Mukesh Patel, Shri Ajit KumarFor Respondent: Shri Prathvi Raj Meena, CIT.DR
Section 153(4)Section 153CSection 35Section 35(1)(i)Section 35(1)(iv)Section 92CSection 92C(2)

findings of the ITAT are reproduced below for reference. "23. We find that the TPO has, in essence, proceeded to make disallowance under section 37(1) by holding that there was no ITA No. 392/Ahd/2023 [Zydus Lifesciences Ltd. vs. DCIT] A.Y. 2017-18 - 17 – commercial expediency in making these reimbursements

Ldm Agro Foods Private Limited, New Delhi vs. DCIT, New Delhi

In the result, the appeal of the assessee is allowed

ITA 4347/DEL/2025[2018-19]Status: DisposedITAT Delhi29 Jan 2026AY 2018-19

Bench: Shri Mahavir Singh, Hon’Ble Vice- & Mrs. Renu Jauhri, Hon’Ble

For Appellant: Shri R S Singhavi, CAFor Respondent: Shri Ajay Kumar Arora, Sr. DR
Section 145Section 148Section 148ASection 250Section 37(1)

ITA No. 4347/DEL/2025 LDM AGRO FOODS PVT LTD IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’, NEW DELHI BEFORE

Manoj Kumar, Panipat vs. Income Tax Officer, Ward -1, Panipat

In the result, appeal of the assessee is allowed

ITA 3378/DEL/2025[2018-19]Status: DisposedITAT Delhi29 Jan 2026AY 2018-19

Bench: Shri Yogesh Kumar U.S & Shri Manish Agarwal[Assessment Year : 2018-19] Manoj Kumar Vs Ito Prop. Avitex India, Barsat Ward-1 Road, Opp.Kirpal Ashram, Panipat Panipat, Haryana-132103. Pan-Aaepo2553J Appellant Respondent Assessee By Shri Suresh Kumar Gupta, Ca Revenue By Ms. Amisha S.Gutpa, Cit Dr Date Of Hearing 27.11.2025 Date Of Pronouncement 29.01.2026 Order Per Manish Agarwal, Am : The Captioned Appeal Is Filed By Assessee Against The Order Dated 27.03.2025 Passed By Ld. Pr. Commissioner Of Income Tax, Rohtak [“Ld. Pr. Cit”] U/S 263 Of The Income Tax Act, 1961 [“The Act”] Arising Out Of Assessment Order Dated 24.02.2023 Passed U/S 147 R.W.S. 144B Of The Act Pertaining To Assessment Year 2018-19. 2. Brief Facts Of The Case Are That The Assessee Filed His Return Of Income On 18.10.2018, Declaring Total Income Of Inr 5,12,820/-. Based On The Available That The Assessee Had Accepted Accommodation Entries In The Form Of Bogus Purchases From M/S. Soni Textiles Of Inr 11,47,500/-, Case Was Re-Opened By Issue Of Notice U/S 148 On 29.03.2022. In Response To The Notice, Assessee Filed Return Of Income On 25.11.2022, Declaring Total Income Of Inr 5,12,820/-. Thereafter, Various Notices Were Issued From Time To Time However, Were Remained Uncompiled With. Thereafter, Ao Vide Order Dated 24.02.2023 Passed U/S 147 R.W.S. 144B Of The Act Assessed The Income Of The Assessee At Inr 16,60,320/- By Making Addition Of Alleged Bogus Purchases.

Section 147Section 148Section 15BSection 263Section 37(1)Section 69C

assessment order, AO raised any doubts about the source of payment made for such purchases. Therefore, he invoked the provisions of section 37(1) of the Act and disallowed the purchases made by the assessee. This being so, the provisions of section 69C of the Act are not applicable

Assistant Commissioner of Income Tax, Circle-25(1), New Delhi, Delhi vs. Techno Trexim India Pvt. Ltd., Delhi

In the result, appeal filed by the assessee is dismissed

ITA 582/DEL/2024[2016-17]Status: DisposedITAT Delhi29 Jan 2026AY 2016-17

Bench: Shris.Rifaur Rahman & Shri Yogesh Kumar Uss.

For Appellant: Shri I.P. Bansal, AdvocateFor Respondent: Shri Abhijeet Kumar, Sr.DR
Section 37

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES ‘E’: NEW DELHI. BEFORE SHRIS.RIFAUR RAHMAN, ACCOUNTANT MEMBER and SHRI YOGESH KUMAR