Section 48 of the Income Tax Act

Income-tax Act, 2025: s.72

Section 48 of the Income-tax Act, 1961 corresponds to section 72 (Mode of computation of capital gains) of the Income-tax Act, 2025.

Read section 72 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 48 is CIT v. Walfort Share & Stock Brokers (P.) Ltd. (326 ITR 1), cited in 543 of the 1,457 judgments on BharatTax that turn on this section.

Leading authorities on Section 48

CIT v. Walfort Share & Stock Brokers (P.) Ltd.
326 ITR 1 · 2010 · Supreme Court
543
citing judgments

For attracting Section 14A disallowance, there must be a proximate cause relating the expenditure to actual tax-exempt income, and such disallowance is not automatic but requires positive material. Additionally, Section 94(7) on dividend stripping only ignores losses to the extent of dividend received for assessment years post-April 1, 2002, allowing the remaining loss.

Escorts Ltd. v. UOI
199 ITR 43 · 1993 · Supreme Court
267
citing judgments

A statute should not be construed to permit double deduction for the same expenditure unless specifically provided by law.

E.D. Sassoon & Co. Ltd. v. CIT
26 ITR 27 · 1954 · Supreme Court
256
citing judgments

Income is taxable only when it represents real income, not notional income. It accrues only when there is a vested right to receive it, typically upon the occurrence of a transfer or event, rather than merely on a time basis.

CIT v. Balbir Singh Maini
398 ITR 531 · 2017 · Supreme Court
228
citing judgments

A transfer of immovable property, for the purpose of capital gains under section 2(47)(v) of the Income-tax Act, occurs only when the agreement allowing possession in part performance of a contract is a registered instrument, as mandated by Section 53A of the Transfer of Property Act.

Gramaphone Co. of India Ltd. v. Birendra Bahadur Pandey
132 Taxmann 373 · 2003 · Supreme Court
146
citing judgments
CIT v. D.P. Sandhu & Bros.
273 ITR 1 · 2005 · Supreme Court
140
citing judgments

Surrender of tenancy rights is a transfer of a capital asset, and the consideration received is a capital receipt subject to capital gains tax. If the cost of acquisition cannot be determined, the transfer of such an asset was not taxable under capital gains prior to the amendment of Section 55(2) in 1995.

Morvi Industries Ltd. v. CIT
82 ITR 835 · 1971 · Supreme Court
136
citing judgments

Income accrues when it becomes due, vesting the assessee with the right to claim the amount, even if payment is not immediate. It requires a corresponding liability from the other party to pay, emphasizing real rather than hypothetical accrual, particularly for assessees using the mercantile system of accounting.

Nirma Industries Ltd. v. DCIT
283 ITR 402 · 2006 · High Court
136
citing judgments

Interest received on delayed payments for sales is considered part of the sale proceeds and is eligible for deduction under Section 80-IA as business income.

CIT v. Manjula J. Shah
355 ITR 474 · 2013 · High Court
113
citing judgments

For capital assets acquired by gift or will, the indexed cost of acquisition under Section 48 is computed with reference to the year the previous owner first held the asset. The period of holding for determining if an asset is long-term also includes the previous owner's holding period, as per Section 2(42A).

Indian Express 498 Newspapers (Bombay) (P) Ltd. v. Union of India
1 SCC 641 · 1985 · Reported
109
citing judgments

The Supreme Court examined the validity of customs duty on newsprint in the context of Article 19(1)(a), emphasizing that the press advances public interest by publishing facts and opinions crucial for a democratic country.

Judgments on Section 48

Vasant N. Barabde, Mumbai vs. Deputy Commissioner of Income Tax, Circle 27(3), Mumbai

In the result, appeal of the assessee is allowed

ITA 5372/MUM/2024[2018-2019]Status: DisposedITAT Mumbai22 May 2025AY 2018-2019

Bench: Shri Sandeep Singh Karhail & Shri Girish Agrawalassessment Year: 2018-19 Vasant Nagorao Barabde Vs Dcit Circle 27(3), 602, Sanskar Santi Park, Mumbai. Ghatkopar East, Income Tax Officer, Vashi Mumbai 400088 Railway Station Building, Navi Mumbai 400703 Pan: Acmpb3211G Appellant Respondent Present For: Appellant By : Shri Dharan Gandhi Ca Respondent By : Ms. Kavitha Kaushik, Dr Date Of Hearing : 27.02.2025 Date Of Pronouncement : 22.05.2025 O R D E R Per Girish Agrawal: This Appeal Filed By The Assessee Is Against The Order Of National Faceless Appeal Centre (Nfac), Delhi Vide Appeal No: Nfac/2017- 18/10041561 Dated 23.08.2024 Passed Against The Assessment Order U/S.143(3) R.W.S 143(3A) & 143(3B) Of The Income-Tax Act, 1961 (Hereinafter Referred To As The “Act”), Dated 08.03.201 For Ay 2018-19. 2. Grounds Taken By The Assessee Are Reproduced As Under: “1. Erred In Confirming The Action Of The Ao In Making The Addition Of Rs 2,88,85.600 By Treating The Market Value Of The Paa Agreement Registered On 21.09.2017 As Taxable Income U/S 56(2)(X) Being Value Of Property For Which No Consideration Is Paid. 2. Erred In Confirming The Action Of The Ao In Making The Addition Of Rs 2,88,85.600 In The Hands Of The Assessee Instead Of Treating The Same As Exempt In The Hands Ashwini Barabde The Daughter Of The Assessee.”

For Appellant: Shri Dharan Gandhi CAFor Respondent: Ms. Kavitha Kaushik, DR
Section 143(3)Section 56(2)(x)

The Kollam District Co Operative Bank Ltd, Kollam vs. Assistant Commissioner of Income Tax, Circle Kollam

In the result, appeal filed by the assessee sands dismissed

ITA 660/COCH/2023[2017-18]Status: DisposedITAT Cochin14 May 2025AY 2017-18

Bench: Shri Inturi Rama Rao, Am & Shri Prakash Chand Yadav, Jm Assessment Year: 2017-18 Kollam District Co-Operative Bank Ltd. .......... Appellant Chinnakada, Kollam 691001 [Pan: Aaaat4088L] Vs. The Income Tax Officer, Circle Kollam .......... Respondent Appellant By: ------- None ------- Respondent By: Shri Sanjit Kumar Das, Cit-Dr Date Of Hearing: 24.02.2025 Date Of Pronouncement: 14.05.2025 O R D E R Per: Inturi Rama Rao, Am This Appeal Filed By The Assessee Is Directed Against The Order Of The National Faceless Appeal Centre, Delhi [Cit(A)], Dated 19.05.2023 For Assessment Year (Ay) 2017-18. 2. Brief Facts Of The Case Are That The Appellant Is A District Co- Operative Bank Engaged In The Business Of Accepting Deposits From Members & Lending Money To Its Members. The Return Of Income For Ay 2017-18 Was Filed On 01.11.2017 Declaring Total Income At Rs. 16,14,89,500/-. Against The Said Return Of Income, The 2 Kollam District Co-Operative Bank Ltd. Assessment Was Completed By The Acit, Circle Kollam (Hereinafter Called "The Ao") Vide Order Dated 23.12.2019 Passed U/S. 143(3) Of The Act At A Total Income Of Rs. 26,20,34,663/-. While Doing So, The Ao Made The Following Disallowances/Additions: -

For Appellant: ------- None -------For Respondent: Shri Sanjit Kumar Das, CIT-DR
Section 143(3)Section 36(1)(vii)Section 36(1)(viia)Section 40Section 48