citedby: 1533071

Commissioner Of Income Tax vs M/S.Vasan Publications Limited on 20 July, 2012

7. As far as the first Appellate Authority is concerned, he accepted the case of the assessee that the decision taken by the Board of Directors was a commercially prudent decision. The Tribunal confirmed this view by holding that the decision taken is a commercially viable decision. Except for stating as prudent decision or viable decision, there is hardly any material to indicate that it was expanded out a commercial expediency. The commercially viable decision need not be one arising out of commercial expediency. The fact is that the said person served in the capacity as Managing Director for a period of 30 years and had contributed his efforts to come out weekly, per se, would not lead to an inference that there was commercial expediency which necessitated the company to incur expenditure which was pure and simple a personal nature. As rightly pointed out by the learned standing counsel for the Revenue, in the decision reported in 263 ITR 115 CIT v. SAMBANDAM SPG. MILLS at page 119, this Court pointed out to the need for recording a specific finding that the expenditure incurred was out of contractual obligation leading to commercial necessity. Thus, when payment is made without any reference to an obligation, leading to commercial expediency, and there being no material even otherwise to show commercial expediency on the part of the company on the decision on medical treatment, we have no hesitation in holding that the payment was not made to facilitate the business of the assessee.

Madras High Court Cites 5 - Cited by 0 - C Venkataraman - Full Document

Ifci Limited, New Delhi vs Dcit, New Delhi on 31 August, 2020

B.17 Another important factor to be kept in mind while examining use for purpose of business is that the section is of wide import and cannot be construed in a narrow manner to state, for instance, that only if the asset in question directly contributes to the output of the business it can be said to be used for the purpose of business. B.18 In Commissioner of Income-tax v. Kalyani Spg. Mills Ltd, [1981] 6 Taxman 50 (Calcutta), the High Court of Calcutta while holding that roads constructed within the factory would be assets used for the purpose of business stated that ―It is true that these are not directly used for the purpose of the business but there is no warrant to restrict the meaning of the expression " used for the purpose of business ". If anything is necessary for the purpose of any building - necessary for the purpose of carrying on the business - then it is for the purpose of the business."

Income Tax Appellate Tribunal - Delhi Cites 20 - Cited by 0 - Full Document

M/S Mrinalini Biri Manufacturing Co., ... vs D.C.I.T.,Circle-8(1), Kolkata on 16 September, 2020

CIT v. Eastern Spg. Mills Ltd. [1980] 126 ITR 686 is the decision of the Calcutta High Court. In pursuance of a statutory requirement under the West Bengal Employees' Payment of Compulsory Gratuity Act, 1971, a special liability was incurred by the assessee and the provision made to meet this liability was claimed as a deduction under section 37. A reasonable amount was allowed as a deduction by the ITO. The High Court held that a prudent estimate of the liability was entitled to deduction under section 37; the contention that gratuity is a subject covered by section 36(1) and, hence, deduction could be claimed only on satisfying its provisions was not accepted. The Bench held:

Income Tax Appellate Tribunal - Kolkata Cites 28 - Cited by 0 - Full Document

Nagreeka Exports Limited vs Assistant Commissioner Of Income Tax on 27 February, 2024

6. Learned counsel for the appellant assessee submits that the expenditure incurred for replacement of ring frames is a revenue expenditure liable for deduction under Section 37 of the Act 1961. He submits that the judgment of Hon'ble Supreme Court in the case of Commissioner of Income Tax v. Sri Mangayarkarasi Mills (P) Limited [2009] 315 ITR 114 (SC) is not applicable inasmuch as in subsequent judgment in Commissioner of Income Tax v. Hindustan Textiles [2010] 190 Taxman 294 (SC) [paragraph 6], Hon'ble Supreme Court directed the High Court to consider the tests laid down in Commissioner of Income Tax v. Sugavaneeshwara Spinning Mills Ltd. 293 ITR 20 (SC), Commissioner of Income Tax v. Ramaraju Surgical Cotton Mills [2007] 294 ITR 328 (SC) and Sri Mangayarkarasi Mills (P) Limited case (supra) for de novo consideration of the case of the assessee of that case. He, therefore, submits that the question as to whether the expenditure incurred for replacement of nine ring frames is a revenue expenditure or capital expenditure, needs reconsideration.

Calcutta High Court Cites 13 - Cited by 0 - R Bharadwaj - Full Document

Syama Prasad Mookerjee Port ,Kolkata vs Acit, Circle -34, Kolkata on 18 November, 2024

7. Our attention has been drawn to a decision of the Andhra Pradesh High Court in CIT v. Super Spg. Mills Lad [1987] 166 ITR 518. In that case also the ITO restricted the claim of the assessee towards contribution to the gratuity fund to 819 per cent but the Commissioner (Appeals) and the Tribunal held that it was not for the ITO to sit in judgment over the approval granted by the Commissioner. It has been held that once approval is accorded by the Commissioner, it is binding on the assessing authority or the AAC and the authorities administering the provisions of the Act, have no power to go behind the approval granted by the Commissioner. Once the Commissioner accords approval, it is binding on the assessing authority and the assessing authority is devoid of power and jurisdiction to go behind the permission to find out whether the contribution made by the assessee is in conformity with the rules or in excess thereof.