Section 36(1)(iv) of the Income Tax Act

Income-tax Act, 2025: ss.29, 30, 31, 32

Section 36(1)(iv) falls under section 36 of the Income-tax Act, 1961, which corresponds to section 29 (Deductions related to employee welfare), section 30 (Deduction on certain premium), section 31 (Deduction for bad debt and provision for bad and doubtful debt) and section 32 (Other deductions) of the Income-tax Act, 2025.

Read section 29 of the 2025 ActRead section 30 of the 2025 ActRead section 31 of the 2025 ActRead section 32 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 36(1)(iv) is CIT v. Rao Bahadur Calavala Cunnan Chetty Charities (135 ITR 485), cited in 98 of the 116 judgments on BharatTax that turn on this section.

Leading authorities on Section 36(1)(iv)

CIT v. Rao Bahadur Calavala Cunnan Chetty Charities
135 ITR 485 · 1982 · High Court
98
citing judgments

The income of a charitable trust, particularly income from property held under trust, for the purpose of claiming exemption under Section 11, must be computed in a normal commercial manner, without strict reference to the computation provisions for different heads of income like Section 14 or Section 24(a). This approach ensures that the income available for application or accumulation is assessed on commercial principles.

Melmould Corporation v. CIT
202 ITR 789 · 1993 · High Court
46
citing judgments

Adjustments to opening stock are not permissible when applying Section 145A, as this would retroactively disturb finalized profit figures of earlier assessment years. MODVAT credit balance in closing stock should be added to income, but corresponding adjustments to opening stock are not allowed.

CIT v. Mazagaon Dock Ltd.
191 ITR 460 · 1991 · High Court
40
citing judgments

A wet dock of a dockyard is considered 'plant' for the purpose of depreciation.

R Dalmia v. CIT
236 ITR 480 · 1999 · Supreme Court
38
citing judgments

When a return is filed under section 148, the assessment and reassessment under section 147 must follow the procedural provisions subsequent to section 139 of the Income Tax Act.

33 ITR 182 (SC). (ii) Investment Ltd. v. CIT
167 Taxmann 256 · 2008 · High Court
33
citing judgments
CIT v. Sirpur Paper Mills
237 ITR 41 · 1999 · Supreme Court
24
citing judgments

The amplitude of a deduction permitted by a section cannot be cut down by imposing conditions that rewrite the section.

77 ITR 533 (SC) (iii) MKB Asia (P.) Ltd. v. CIT
101 ITR 40 · 1975 · High Court
22
citing judgments

The Assessing Officer has the discretion to select an accounting method and the assessee cannot compel the department to adopt a particular method.

CIT-1, Lucknow v. U.P. Rajya Vidyut Utpadan Nigam Ltd.
37 Taxmann.com 164 · 2013 · High Court
22
citing judgments

The provision of Section 43B of the Income Tax Act, 1961, is not applicable to interest payable on loans obtained from the Government of India. Consequently, disallowance under Section 43B for non-payment of such interest is not permissible.

Commissioner of Income Tax v. Western India Paper and Paperboard Private Limited
189 ITR 309 · 1991 · High Court
21
citing judgments

Expenditure not allowable under Section 36(1)(iv) of the Income Tax Act may still be allowable under Section 37 of the Act, even if the Tribunal followed this decision.

167 Taxman 256 (Gau.) 35 (iv) JuggilalKamlaat Bankers v. CIT
75 Taxmann 335 · 1994 · High Court
21
citing judgments

Judgments on Section 36(1)(iv)

Sunrise Facilitators Private Limited, Chandigarh vs. Dy. Commissioner of Income Tax, Panchkula

ITA 689/CHANDI/2023[2019-20]Status: DisposedITAT Chandigarh18 Aug 2025AY 2019-20

Bench: Hon’Ble Shri Laliet Kumar, Jm & Hon’Ble Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./ Ita No.689/Chandi/2023 (िनधा"रण वष" / Assessment Year: 2019-20) M/S Sunrise Facilitators Pvt. Ltd. Dcit Circle बनाम/ Vs. 2238/5B, Shanti Nagar Aaykar Bhawan, Manimajra, Chandigarh. Sector 2, Panchkula "थायीलेखासं./जीआइआरसं./Pan/Gir No. Aaics-0850-M (अपीलाथ"/Appellant) : (""थ" / Respondent) अपीलाथ"कीओरसे/ Appellant By : Shri Parikshit Aggarwal (Ca) – Ld. Ar ""थ"कीओरसे/Respondent By : Smt. Priyanka Dhar (Addl. Cit) – Ld. Sr. Dr सुनवाईकीतारीख/Date Of Hearing : 06-08-2025 घोषणाकीतारीख /Date Of Pronouncement : 18-08-2025. आदेश / O R D E R Manoj Kumar Aggarwal () 1. Aforesaid Appeal By Assessee For Assessment Year (Ay) 2019-20 Arises Out Of An Order Of Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Cit(A)] Dated 18-08-2022 In The Matter Of An Intimation Issued By Cpc U/S 143(1) On 15-09-2020 Disallowing Late Payment Of Employees’ Contribution To Pf / Esi For Rs.161.54 Lacs U/S 36(1)(Va) R.W.S. 2(24)(X) As Reported By Tax Auditor In Tax Audit Report. The Ld. Cit(A)

For Appellant: Shri Parikshit Aggarwal (CA) – Ld. ARFor Respondent: Smt. Priyanka Dhar (Addl. CIT) – Ld. Sr. DR
Section 143(1)Section 2(24)(x)Section 36(1)(iv)Section 36(1)(va)Section 43B

DCIT., Circle-13(1), Hyderabad vs. The Singareni Collieries Company Limited, Kothagudem

In the result, assessee’s appeals for the A

ITA 308/HYD/2024[AY-2020-2]Status: DisposedITAT Hyderabad12 Jun 2025

Bench: Shri Vijay Pal Rao, Vice-A N D Shri Manjunatha, G.आ.अपी.सं /Ita Nos.283, 284 & 286/Hyd/2024 (िनधा"रण वष"/Assessment Years: 2015-16, 2016-17 & 2020-21) Singareni Collieries Vs. Acit, Circle – 1 Company Limited Khammam & Kothagudem Acit, Circle 13(1) Pan:Aaact8873F Hyderabad & आ.अपी.सं /Ita Nos.300, 301 & 308/Hyd/2024 (िनधा"रण वष"/Assessment Years: 2015-16, 2016-17 & 2020-21) Vs. Singareni Collieries Dy. Cit, Circle 13(1) Company Limited Hyderabad Kothagudem Pan:Aaact8873F (Appellant) (Respondent) िनधा""रती "ारा/Assessee By: Shri M.V.Anil Kumar, Advocate राज" व "ारा/Revenue By:: Shri B Balakrishna, Cit (Dr) सुनवाई की तारीख/Date Of Hearing: 10/06/2025 घोषणा की तारीख/Pronouncement: 12/06/2025 आदेश/Order Per Bench: These 3 Sets Of Cross Appeals Filed By The Assessee As Well As The Revenue Are Directed Against The 3 Separate Orders All Dated 30/01/2024 Of The Learned Cit (A)-Nfac Delhi, For The A.Ys 2015-16, 2016-17 & 2020-21 Respectively. The Assessee As Well As The Revenue Have Raised The Following Grounds Of Appeals For 3 A.Ys:

For Appellant: Shri M.V.Anil Kumar, AdvocateFor Respondent: : Shri B Balakrishna, CIT (DR)
Section 40A(9)