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M/S.Bilahari Investments (P) Ltd vs The Commissioner Of Income Tax on 19 June, 2006 cites

M/S Madras Industrial ... vs The Commissioner Of Income Tax,Tamil ... on 4 April, 1997

3.4. The learned counsel further submitted that the decision of the Supreme Court in Madras Industrial Investment Corporation Ltd., v. CIT (225 ITR 802) dealing with the discount on debenture, is distinguishable on the facts of the present case, as in the said case, the difference between the face value and the actual amount realised from the customers was considered to be a discount on debenture and the said discount must be spread over the period of life of the debentures, whereas in this case the assessees took the chit at discounted value prior to the termination of the chit with agreement to continue to contribute the chit till it is formally terminated and therefore, the difference is obvious, that is, in the case of the former it is a case of receipt while in the case of latter, it is the amount paid followed by encashment of the chit at an early date with a promise to pay the remaining instalments.
Supreme Court of India Cites 16 - Cited by 445 - Full Document

Soda Silicate And Chemical Works vs Commissioner Of Income-Tax on 4 April, 1989

7.3. We are unable to agree with the decision of the Division Bench of Punjab and Haryana High Court in Soda Silicate and Chemical Works Vs. Commissioner of Income-tax case, cited supra. The Punjab and Haryana High Court held that the discount amount is not allowable as business loss on the ground that the transaction involved did not give rise to any income assessable to income-tax, nor any revenue loss in respect of which any deduction could be claimed. The judgment of the Punjab and Haryana High Court has no relevance to the facts of the present case, as, in this case, business loss occurred during the previous year relevant for the assessment year and the discount is found to be connected with the business activities of the assessees, whereas in the case before the Punjab and Haryana High Court, on facts, it was found that the discount is not connected with the business of the assessee.
Punjab-Haryana High Court Cites 8 - Cited by 28 - Full Document

Shiva Prasad Gupta vs Commissioner Of Income-Tax on 20 February, 1929

9.3. A conjoint reading of the above provisions of law makes it clear that all income received or deemed to be received or accrues or arises during the previous year shall form part of the total income of the assessee and such income shall be computed in accordance with the accounting system which the assessee is regularly following. Here, on the facts of the case, the authorities have found that the assessees are following mercantile system of accounting. The mercantile system of accounting means, as discussed in Shiva Prasad Gupta v. C.I.T. (AIR 1929 All. 823), the amounts that have become recoverable are shown as the income actually received and the liabilities incurred are shown as amounts actually disbursed in any particular year. Therefore, when the assessees are following mercantile system of accounting, in which entries are posted in the books of account on the date of the transaction, that is, on the date on which rights accrue or liabilities are incurred irrespective of the date of payment, they have to account for their income or loss as per the mercantile system of accounting and not otherwise. Therefore, as rightly found by the Commissioner of income-tax (Appeals), the income derived during a particular previous year by way of chit dividend has to be reckoned and assessed as income of that year following the principles of mercantile/accrual system of accounting, particularly when the assessees are companies following the mercantile system of accounting.
Allahabad High Court Cites 4 - Cited by 18 - Full Document

State Of Bihar & Others vs Bihar Rajya M.S.E.S.K.K.Mahasangh.& ... on 12 October, 2004

(b) any provision contained in the memorandum, articles, bye-laws, agreement or resolution aforesaid, shall, to the extent to which it is repugnant to the provisions of this Act, become or be void, as the case may be", the definitions of the expressions, discount, dividend, prize amount, as extracted above, will prevail over the similar definitions as found in the Income-tax Act, because a non obstante clause is generally appended to a section with a view to give the enacting part of the section in case of conflict, an overriding effect over the provision in the same or other Act mentioned in the non obstante clause (vide: State of Bihar v. Bihar Rajya M.S.E.S.K.K.Mahasangh (2005) 9 SCC 129). Therefore the discount is not an interest payable on the prized amount, but it is a loss.
Supreme Court of India Cites 4 - Cited by 164 - D M Dharmadhikari - Full Document
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