This Digest of case laws is prepared by KSA Legal and AIFTP from judgements reported in BCAJ, CTR, DTR, ITD, ITR, ITR (Trib), Chamber's Journal, SOT, Taxman, TTJ, BCAJ, ACAJ, www.itatonline.org and other journals
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S. 37(1) : Business expenditure-Capital or revenue-Expenses incurred for upgradation of computers and to acquire software-Held to be revenue expenditure.

CIT (LTU) v. ABB Ltd. (2020)429 ITR 355 (Karn.)(HC)

S. 36(1)(viii) : Eligible business-Special reserve-Financial Corporation-Entitled to deduction. [Companies Act, 1956. S. 3, 617]

CIT(LTU) v. Vijaya Bank (2020) 429 ITR 407 / 277 Taxman 148(Karn.)(HC)

S. 36(1)(iii) : Interest on borrowed capital-Amount advanced to sister concern without charging interest-Business purpose-Held to be allowable.

CIT v. Gokaldas Images Pvt. Ltd. (2020) 429 ITR 526 / (2021) 197 DTR 225 / 318 CTR 486 / 276 Taxman 420 (Karn.)(HC)

S. 36(1)(iii) : Interest on borrowed capital Sufficient surpluses and reserves-No disallowance of interest can be made.

CIT v. Brigade Enterprises Ltd. (No. 2) (2020) 429 ITR 615 / (2021) 318 CTR 325 / 197 DTR 319/ 278 Taxman 81 (Karn.)(HC)

S. 32 : Depreciation-Hotel-Additional floor space index granted-One instalment paid and entire amount debited in accounts-Entitled to depreciation on entire amount at rate applicable to buildings. [S. 32(1)(ii), 43(6)(c)]

PCIT v. V. Hotels Ltd. (2020) 429 ITR 54 / 275 Taxman 106 / 317 CTR 377 / 194 DTR 369(Bom.)(HC)

S. 14A : Disallowance of expenditure-Exempt income-Tribunal justified in deleting the addition made by the Assessing Office. [s. 10(38), R. 8D]

CIT v. Sociedade De Fomento Industrial Pvt. Ltd. (No. 1) (2020) 429 ITR 207 / 276 Taxman 90 / 196 DTR 377 / (2021) 318 CTR 38 (Bom.)(HC) Editorial : Notice issued in SLP filed against order of High Court , CIT v. Sociedade De Fomento Industrial Pvt. Ltd ( 2021 ) 281 Taxman 297/ 283 Taxman 1 / 283 Taxman 6( SC), SLP dismissed ,CIT v. Sociedade De Fomento Industrial Pvt. Ltd. (2022)443 ITR 34 / 211 DTR 305/ 325 CTR 507 (SC)

S. 14A : Disallowance of expenditure-Exempt income-Onus to establish such proximity on department-Assessing Officer must give a clear finding with reference to the assessee’s accounts how expenditure related to exempt income. [S. 10(35), R. 8D]

CIT v. Sociedade De Fomento Industrial Pvt. Ltd. (No. 2) (2020) 429 ITR 358 / (2021) 277 Taxman 6/ 207 DTR 381/ (2022) 324 CTR 524 (Bom.)(HC)

S. 14A : Disallowance of expenditure-Exempt income-Failure by Assessing Officer to record dissatisfaction-No disallowance could be made. [R. 8D]

CIT v. Brigade Enterprises Ltd. (No. 2) (2020) 429 ITR 615 / (2021) 318 CTR 325 / 197 DTR 319 / 278 Taxman 81(Karn.)(HC)

S. 14A : Disallowance of expenditure-Exempt income-Disallowance cannot exceed exempt income earned. [R. 8D]

PCIT v. Ajit Ramakant Phatarpekar (2020) 429 ITR 319 / 196 DTR 296 (Bom.)(HC) PCIT v. Neelam Ajit Phatarpekar (2020) 429 ITR 319 / 196 DTR 296 (Bom.)(HC)

S. 11 : Property held for charitable purposes-Statutory Board under control of State Government-Entitled to exemption. [S. 2(15)]

DIT(E) v. Karnataka Industrial Area Development Board (2020) 429 ITR 249 / (2021) 277 Taxman 36 (Karn.)(HC)