Section 145(1) of the Income Tax Act
Income-tax Act, 2025: s.276
Section 145(1) falls under section 145 of the Income-tax Act, 1961, which corresponds to section 276 (Method of accounting) of the Income-tax Act, 2025.
Read section 276 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 145(1) is CIT v. Dilip Singh Sardarsingh Bagga (201 ITR 995), cited in 40 of the 103 judgments on BharatTax that turn on this section.
Leading authorities on Section 145(1)
Registration of a motor vehicle under the Motor Vehicles Act is not a prerequisite for claiming depreciation under the Income Tax Act. Beneficial ownership and actual use for business purposes are sufficient.
Amortization of premium on purchase of government securities is allowable as a deduction if it is in line with RBI's prudential norms and the assessee follows a consistent accounting system.
Depreciation on a vehicle cannot be denied solely because the transfer was not recorded under the Motor Vehicles Act or the vehicle stood in the vendor's name in official records, if the assessee can establish ownership.
A real estate developer adopting the completed contract method of accounting cannot be forced to follow the percentage completion method under AS-7 if AS-7 has not been specified by the Central Government under section 145(2). The Assessing Officer cannot reject accounts under section 145(3) solely on this ground.
The Assessing Officer can admit additional evidence during assessment proceedings if it is necessary to determine the true total income of the assessee.
Interest on securities becomes due and receivable only upon maturity and cannot be taxed prior to maturity. The entitlement to interest arises only at that point.
Cooperative banks are eligible to claim deduction under both limbs of Section 36(1)(viia) for all types of loans and advances extended by their rural branches.
Foreign currency, and therefore derivative/forward contracts in respect of foreign currency, cannot be considered a commodity for the purpose of speculative transaction provisions. Such contracts entered into for hedging foreign exchange fluctuations are not speculative.