Case Laws Analysis
Followed on Rahul Textile Industries (P) Ltd. v. Pr. CIT 2022 TaxPub(DT) 2830 (Sur-Trib)
Followed on Dy. CIT v. Kunnam Granite Works 2022 TaxPub(DT) 1261 (Chen-Trib)
Followed on Pr. CIT v. United Spirits Ltd. 2021 TaxPub(DT) 5918 (Karn-HC)
Followed on Paramount Communications Ltd. v. Dy. CIT 2021 TaxPub(DT) 4514 (Del-Trib)
Followed on DCIT v. Idea Cellular Ltd. 2021 TaxPub(DT) 3052 (Mum-Trib)
Followed on CIT v. Barclays Investments & Loans (India) Ltd. 2021 TaxPub(DT) 1965 (Mad-HC)
Relied on CIT v. Quest Global Engineering Services (P) Ltd. 2021 TaxPub(DT) 1428 (Karn-HC)
Relied on Lifecell International (P) Ltd. v. Asstt. CIT 2021 TaxPub(DT) 0973 (Mad-HC)
Relied on High Energy Batteries India Ltd. v. ITO 2021 TaxPub(DT) 0461 (Chen-Trib)
Followed on Shin-Etsu Polymers India (P) Ltd. v. Dy. CIT 2020 TaxPub(DT) 5399 (Chen-Trib)
Followed on Aesseal India Pvt. Ltd. v. ITO 2020 TaxPub(DT) 5344 (Pune-Trib)
Followed on Sitae Re (P) Ltd. v. ITO 2020 TaxPub(DT) 4984 (Del-Trib)
Relied on Tanglin Developments Ltd. v. Dy. CIT 2020 TaxPub(DT) 2702 (Bang-Trib)
Followed on Hueco Electronics (I) (P) Ltd. v. Dy. CIT 2020 TaxPub(DT) 0947 (Pune-Trib)
Distinguished on Ircon International Ltd. v. Addl. CIT 2019 TaxPub(DT) 7432 (Del-Trib)
Relied on Emmsons International Ltd. v. ACIT 2019 TaxPub(DT) 6950 (Del-Trib)
Relied on Chryso India (P) Ltd. v. ACIT 2019 TaxPub(DT) 5046 (Kol-Trib)
Followed on Dy. CIT v. Mcleod Russel India Ltd. 2019 TaxPub(DT) 3205 (Kol-Trib)
Followed on Dy. CIT v. Terex India (P.) Ltd. 2019 TaxPub(DT) 2408 (Del-Trib)
Followed on DCIT v. Menarini Raunaq Pharma Ltd. 2019 TaxPub(DT) 1824 (Del-Trib)
Followed on Rollatainers Ltd. v. DCIT 2019 TaxPub(DT) 1712 (Del-Trib)
Followed on DCIT v. Creative Portico (I) (P) Ltd. 2018 TaxPub(DT) 7259 (Mum-Trib)
Followed on CIT v. Shasun Chemicals & Drugs Ltd. 2018 TaxPub(DT) 6059 (Mad-HC)
Followed on Oil & Natural Gas Corporation Ltd. v. Addl. CIT 2018 TaxPub(DT) 5802 (Del-Trib)
Followed on CIT v. Paper Products Ltd. 2018 TaxPub(DT) 4847 (Bom-HC)
Followed on Sterlite Technologies Ltd. v. Dy. CIT 2018 TaxPub(DT) 2955 (Mum-Trib)
Distinguished on Niru Impex v. DCIT 2018 TaxPub(DT) 2919 (Mum-Trib)
Relied on Labvantage Solutions (P.) Ltd. v. Asstt. CIT 2018 TaxPub(DT) 2871 (Kol-Trib)
Followed on Afcons Infrastructure Ltd. v. Dy. CIT 2018 TaxPub(DT) 2340 (Mum-Trib)
Relied on Wipro Ltd. & Anr. v. DCIT 2018 TaxPub(DT) 2078 (Del-Trib)
Relied on on Wipro Ltd. & Anr. v. DCIT 2018 TaxPub(DT) 2078 (Del-Trib)
Referred on Toshiba Embedded Software (India) Pvt. Ltd. v. Dy. CIT 2018 TaxPub(DT) 2068 (Bang-Trib)
Referred on Intervet India (P.) Ltd. v. Dy. CIT 2018 TaxPub(DT) 0849 (Pune-Trib)
Referred on CIT v. Walchandnagar Industries Ltd. 2017 TaxPub(DT) 5140 (Bom-HC)
Relied on Dy. CIT v. Eveready Industries India Ltd. 2017 TaxPub(DT) 4646 (Kol-Trib)
Distinguished on TVS Motor Company Ltd. v. Asstt. CIT 2017 TaxPub(DT) 0210 (Chen-Trib)
Relied on Silicon Graphics Systems (India) (P) Ltd. v. DCIT 2016 TaxPub(DT) 3994 (Del-Trib)
Followed on CIT v. Vinergy International (P) Ltd. 2016 TaxPub(DT) 3773 (Bom-HC)
Followed on Dy. CIT v. Pricewaterhouse Coopers Pvt. Ltd. & Vica-Versa 2016 TaxPub(DT) 3465 (Kol-Trib)
Followed on Asstt. CIT v. Timex Watches Ltd. 2016 TaxPub(DT) 3433 (Del-Trib)
Followed on Vivimed Labs Ltd. v. Dy. CIT 2016 TaxPub(DT) 3328 (Hyd-Trib)
Referred on Intervet India (P.) Ltd. v. Dy. CIT 2016 TaxPub(DT) 2972 (Pune-Trib)
Applied on Bhai Gurudas Educational Trust v. CIT 2016 TaxPub(DT) 1855 (Chd-Trib)
Followed on NLC Nalco India Ltd. v. Dy. CIT 2016 TaxPub(DT) 1853 (Kol-Trib)
Followed on Eveready Industries India Ltd. v. Dy. CIT 2016 TaxPub(DT) 1192 (Kol-Trib)
Followed on Rolls Royce India (P) Ltd. v. Dy. CIT 2016 TaxPub(DT) 1151 (Del-Trib)
Followed on Rampgreen Solutions (P) Ltd. v. Dy. CIT 2016 TaxPub(DT) 1076 (Del-Trib)
Followed on Bechtel India (P) Ltd. v. Dy. CIT 2015 TaxPub(DT) 5137 (Del-Trib)
Followed on EIH Ltd. v. Dy. CIT 2015 TaxPub(DT) 5066 (Kol-Trib)
Applied on J.P. Morgan Securities India (P) Ltd. v. Addl. CIT 2015 TaxPub(DT) 3629 (Mum-Trib)
Followed on Vassantram Mehta & Co. (P) Ltd. v. Jt. CIT 2015 TaxPub(DT) 3033 (Bom-HC)
Relied on Asstt. CIT v. Gillette India Ltd. 2015 TaxPub(DT) 2990 (Jp-Trib)
Followed on G.E. Capital Services India & Ors. v. Addl. CIT & Ors. 2015 TaxPub(DT) 2753 (Del-Trib)
Relied on K.L. Hitech Secure Print Ltd. v. Jt. CIT 2015 TaxPub(DT) 2561 (Hyd-Trib)
Followed on CIT v. Tony Electronics Ltd. 2015 TaxPub(DT) 2002 (Del-HC)
Followed on Oswal Agro Mills Ltd. v. CIT 2015 TaxPub(DT) 0523 (Del-HC)
Relied on Lanco Kondapalli Power Ltd. v. JCIT 2014 TaxPub(DT) 2699 (Hyd-Trib)
Followed on India Gelatine And Chemicals Ltd. v. Asstt. CIT (No. 2) 2014 TaxPub(DT) 2569 (Guj-HC)
Relied on Gillette India Ltd. v. CIT & Anr. 2014 TaxPub(DT) 1972 (Raj-HC)
Followed on CIT v. Samsung India Electronics Ltd. 2013 TaxPub(DT) 2111 (Del-HC)
Applied on Commissioner of Income-Tax & Anr. v. Wipro Finance Ltd. 2013 TaxPub(DT) 0698 (Karn-HC)
Followed on Ascendas (India) Private Ltd. v. Dy. CIT 2013 TaxPub(DT) 0661 (Chen-Trib)
Followed on Mettler Toledo India (P.) Ltd. v. ITO 2013 TaxPub(DT) 0276 (Mum-Trib)
Followed on R.R. Kabel Ltd. v. Addl. CIT 2013 TaxPub(DT) 0026 (Mum-Trib)
Distinguished on K.M. Mehaboob v. Dy. CIT & Anr. 2012 TaxPub(DT) 3247 (Ker-HC)
Relied on Kodiak Networks (India) (P.) Ltd. v. Asstt. CIT 2012 TaxPub(DT) 2925 (Bang-Trib)
Applied on Commissioner Of Income-Tax And Another v. Lucent Technologies Hindustan Ltd. 2012 TaxPub(DT) 2045 (Karn-HC)
Followed on Dy. CIT v. Cosmo Films Ltd. & Ors. 2012 TaxPub(DT) 1094 (Del-Trib)
Followed on Symantec Software Solutions (P) Ltd. v. ACIT 2012 TaxPub(DT) 0885 (Mum-Trib)
Applied on Convergys India Services (P.) Ltd. v. Dy. CIT 2012 TaxPub(DT) 0722 (Del-Trib)
Relied on Convergys India Services (P.) Ltd. v. Dy. CIT 2012 TaxPub(DT) 0722 (Del-Trib)
Applied on Sterling Agro Products Processing (P) Ltd. v. Asstt. CIT 2012 TaxPub(DT) 0288 (Chen-Trib)
Followed on Asstt. CIT v. Chettinad Cement Corporation Ltd. 2011 TaxPub(DT) 1620 (Chen-Trib)
Relied on CIT v. Shasun Chemicals & Drugs Ltd. 2011 TaxPub(DT) 1437 (Mad-HC)
Followed on CIT v. Shasun Chemicals & Drugs Ltd. 2011 TaxPub(DT) 1437 (Mad-HC)
Followed on CIT v. National Hydroelectric Power 2011 TaxPub(DT) 0738 (P&H-HC)
Followed on CIT & Anr. v. Dinesh Kumar Goel 2011 TaxPub(DT) 0588 (Del-HC)
Followed on Dy. CIT v. Lazard India (P) Ltd. 2010 TaxPub(DT) 2015 (Mum-Trib)
Followed on Oil & Natural Gas Corpn. Ltd. v. CIT 2010 TaxPub(DT) 1672 (SC)
Followed on ITO v. J.V. Electronics (P) Ltd. 2009 TaxPub(DT) 1951 (Del-Trib)
Affirmed on CIT v. Woodward Governor India (P) Ltd. 2007 TaxPub(DT) 1205 (Del-HC)
Followed on CIT v. Paper Products Ltd. 2004 TaxPub(DT) 1119 (Del-HC)
 
The Tax Publishers2009 TaxPub(DT) 1628 (SC) : (2009) 030 (I) ITCL 0587 : (2009) 312 ITR 0254 : (2009) 223 CTR 0001 : (2009) 179 TAXMAN 0326 : (2009) 021 DTR 0106

CIT v. Woodward Governor India P. Ltd.

INCOME TAX ACT, 1961

Business expenditure - Allowability -Foreign exchange fluctuation

Assessee had debited unrealized loss due to foreign exchange fluctuation in foreign currency transaction on revenue items to its profit and loss account on the last date of accounting year. AO viewed that liability as on last date of previous year under consideration was not an ascertained liability, but a contingent liability and, consequently, he made addition to total income. Held: As per section 37(1), expenditure cover an amount which was really a loss, even though said amount had not gone out from pocket of assessee. Entity had to report outstanding liability relating to import of raw material using closing rate of foreign exchange and any difference, loss or gain, arising on conversion of said liability at closing rate should be recognized in profit and loss account for reporting period. Hence, loss suffered on account of foreign exchange fluctuation as on date of balance sheet was allowed as deduction under section 37(1).

Income-tax Act, 1961, Section 37(1), read with section 145

A.Y. : 1998-99
Decision: In favour of assessee.

Case Law Analysis:Indian Molasses Co. Ltd. v. CIT [1959] 37 ITR 66 (SC) [Para 6], Maruti Udyog Ltd. [Civil Appeal arising out of SLP(C) No. 18967 of 2008] [Para 9], M.P. Financial Corpn. v. CIT [1987] 165 ITR 765/[1986] 26 Taxman 42 (MP) (Indore Bench) [Para 14], Madras Industrial Investment Corpn. Ltd. v. CIT [1997] 225 ITR 802 / 91 Taxman 340 (SC) [Para 14], United Commercial Bank v. CIT [1999] 240 ITR 355 / 106 Taxman 601 (SC) [Para 16], Sutlej Cotton Mills Ltd. v. CIT [1979] 116 ITR 1 (SC) [Para 20] and CIT v. Arvind Mills Ltd. [1992] 193 ITR 255 / 60 Taxman 192 (SC) [Para 28].

INCOME TAX ACT, 1961

Depreciation - Actual cost -Amendment in section 43A with effect from 1-4-2003

Held: As amended section 43A would be applied prospectively effective from 1-4-2003, therefore, assessee was entitled to depreciation on notionally enhanced value of capital asset due to foreign exchange fluctuation at the end of each financial year and not at the time of payment during the year. Hence, prior to amendment to section 43A, assessee was entitled to adjust actual cost of imported assets acquired in foreign currency on account of fluctuation in rate of exchange at each balance-sheet date, pending actual payment of varied liability.

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