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Documents citing Ito, Wd-4(1), Kolkata, Kolkata vs The Calcutta Jute Mfg. Co. Ltd., Kolkata on 3 February, 2017

Cosmos Industries Ltd., Ghaziabad vs Dcit, New Delhi on 31 December, 2018

It is only elementary that dividend income, whether the shares are held as investments or as any other asset, is always taxable under the head 'income from other sources'. Therefore, nothing really turns on Assessing Officer's emphasis on the fact that the Camelot shares were shown as investments in the balance sheet and that dividend income from these shares is taxable as income from other sources. We have also noted that as long as shares are acquired on the grounds of business expediency, any loss on sale thereof is also required to be treated as an admissible business deduction. Hon'ble Supreme Court's judgment in the case of Patnaik & Co (supra) deals with a situation in which the assessee had subscribed to certain Government security but incurred a loss on sale of that security. The stand of the assessee was that the assessee had made the said investment with a view to promote its business interests and as subscription to the Government Loan was conducive to its business, the loss arose in the course of the business, and that, therefore, the assessee was entitled to a deduction of the loss claimed by it. A coordinate bench of this Tribunal upheld the claim made by the assessee. The Tribunal found that having regard to the sequence of events and the close proximity of the investment with the receipt of the Government orders, the conclusion was inescapable that the investment was made in order to further the sales of the assessee and boost its business. In the circumstances, the Tribunal held that the investment was made by way of commercial expediency for the purpose of carrying on the assessee's business and that, therefore, the loss suffered by the assessee on the sale of the investment must be regarded as a revenue loss. Upholding the stand of the Tribunal, Hon'ble Supreme Court held that the Tribunal was right in its view. It is thus clear that as long as investment is justified on the grounds of commercial expediency, the loss on sale of such investment is to be considered a business loss. The nature of business expediency could vary from case to case but what is important is that there must be an underlying motive to serve business interests of the assessee in making such investment. Let us now turn to the facts of the case before us. The company in which shares are subscribed is engaged only in the business of manufacturing the toothbrushes for the assessee company. Any investment in such a company is justified for pure commercial considerations, and, therefore, loss on sale of such shares is admissible as business losses.
Income Tax Appellate Tribunal - Delhi Cites 21 - Cited by 4 - Full Document

The Dcit, Circle-1, Thiruvalla, ... vs M/S.Fudge Industries P. Ltd, ... on 25 May, 2018

6.2 Further, we make it clear that even if the assessee has credited the waiver of any portion of loan to Profit & Loss account, it cannot be considered as income of the assessee. It is inappropriate to say that the assessee was debarred from claiming the same as not income either u/s. 28(iv) or 41(1) of the I.T. Act. In our opinion if the assessee under some misapprehension or mistake made an entry in the Profit & Loss account and credited the said waiver of the loan to the Profit & Loss account and although under the law, it cannot be treated as income of the assessee, the assessee will not lose the right of claiming that it is not the income of the assessee. Whether the assessee is entitled to a particular deduction or not, will depend on the provisions of law relating thereto and not on the view which the assessee might take of his rights nor can the existence or absence of entries in the Profit & Loss account be decisive or conclusive in the matter as held by the Supreme Court in the case of CIT vs. Kedarnath Jute Mfg. Co. Ltd. (82 ITR 363). In our opinion, the CIT(A) is justified in deleting the addition made on this count. This ground of appeal of the Revenue is dismissed.
Income Tax Appellate Tribunal - Cochin Cites 5 - Cited by 0 - Full Document

Dcit 8(2), Mumbai vs Lexi P.Ltd, Mumbai on 21 April, 2017

the justification for the claimed deduction, however, the Ld. Assessing Officer was not satisfied with the claim and disallowed the same. On appeal before the Ld. Commissioner of Income Tax (Appeal), as reproduced hereinabove, the claim of the assessee was allowed, which is under challenge before this Tribunal. We find that for claiming the deduction u/s 80IB of the Act, the assessee has to fulfil the conditions contained in sub-section(2) of the section. These conditions has been enumerated/dealt with by the Ld. Commissioner of Income Tax (Appeal) in the order along with the factum of establishing the factory set-up on Daman. There is uncontroverted finding that new industrial undertaking was formed at Daman by transferring more than 20% of the plant and machinery previously used by the assessee in its industrial premises at Bombay. The Ld. Commissioner of Income Tax (Appeal) has already placed reliance upon the decision in CIT vs Kedarnath Jute Mfg. Co. 82 ITR 363 (SC), Tuticorin Alkalis Chemicals and Fertilizers Ltd. 227 ITR 172 and Mc.Dowells Co. Ltd. 154 ITR 148 along with other decisions of the Tribunal. So far as, the contention of the Revenue that the order of the Tribunal has been challenged before the Hon'ble High Court, is concerned, no contrary decision was brought to our notice, therefore, the order of the Tribunal as on date, stands. The assessee set- up the industrial undertaking in industrially backward the state, wherein, certain benefits are extended to the assessee. The operation of Mumbai unit continued during 6 ITA No.6162/Mum/2014 M/s Lexi Pvt. Ltd.
Income Tax Appellate Tribunal - Mumbai Cites 2 - Cited by 0 - Full Document
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