Court : Gujarat
Reported in : (1986)50CTR(Guj)242; [1986]160ITR35(Guj)
..... the revenue contended that since a new asset in the nature of addition of a loft, or, in any case, an advantage of enduring benefit came into existence, the impugned expenses are capital in nature and, therefore, the aac was justified in affirming the order the income-tax officer ..... more suitable for the business purposes, they could not be treated as capital expenses since on surrender of the lease, the assessee could not have taken the benefit with him and would have to leave the premises together with the improvements made therein. ..... in that context, the karnataka high court found that the test of obtaining advantage of enduring benefit would not clinch the issue, and the aim and purpose of the expenses must be examined, and if the advantage obtained by entailing the expenditure consisted in facilitating the ..... if they are not entailed for extension of business or for advantage of the enduring benefit to the business, but made for the purposes of running the business or working it with a view to produce ..... there may be cases where expenses, even if resulting in the advantage of an enduring benefit, may be properly chargeable to revenue account if the advantage consists merely in facilitating the assessee's trading operations, or enabling him to manage and conduct his business more ..... tribunal was right in law in holding that the tea expenses were not in the nature of the entertainment expenditure which could be disallowed under section 37(2b) of the income-tax act, 1961 ?' 5. .....
Tag this Judgment!Court : Gujarat
Reported in : [1975]100ITR516(Guj)
..... sisters belonged to dawoodi bohra community and the trusts were executed in respect of certain properties which were situated at surat and bombay and by these two trust deeds the properties were vested for the benefit of dawoodi bohra community to be managed and applied by the chief of the dawoodi bohra community, namely, the mullaji saheb and by his successors-in office. ..... overriding factors it must be half that the properties in question settled by the two deeds of january 12, 1937, were settled upon trust for charitable or religious object and were, therefore entitled to exemption under section 11(1)(a) of the act of 1961. ..... of the revenue, the revenue, the following question has been referred to us : 'whether, on the facts and circumstances of the case, the trusts are wholly religious and entitled to exemption under section 11(1)(a) of the income-tax act, 1961 ?' 2. ..... to be religious pious or charitable according to the notions of members of the dawoodi bohra community and further the income in the corpus of theses properties settled upon trust must be used for dawat purposes, that is, for the benefit of the dawoodi bohra community. ..... they must also be for the benefit of the dawoodi bohra community. ..... the funds are held by a religious head for the benefit of the community as was whole. ..... the properties which were the subject-matter of wakfs, according to the tribunal, vested in the mullaji saheb (as dai-ul-mutlak for the time being in office) for the benefit of the dawoodi bohra community. .....
Tag this Judgment!Court : Gujarat
Reported in : (1984)2GLR858; [1984]150ITR276(Guj)
..... he has separate and real existence; he is governed by the terms of the partnership deed; his rights and liabilities are governed by the terms of the contract and by the provisions of the partnership act; his liability to third parties for the acts of the partnership is c-equal with that of the other partners; the other partners have no concern with the real owner; they can only look to him of enforcing their rights or discharging their ..... partnership will not be invalid or against law, but partnership being a relationship between persons who have agreed to share, the profits of a business carried on by all or any of them acting for all and the relationship of partnership being one that arises from a contract, the persons who come together in the partnership will be recognised as between them as partners. ..... act, 1961, is the revenue to take note of the representative character of the assessee and make disallowance falling with in the section in accordance there with that is the question which we are really called upon to answer here. ..... a relationship created by contract, only the parties to the contract are recognised as partners and that being so, irrespective of the capacity in which a partner acts, whatever interest is paid to the partner from the firm is, according to the revenue, to be disallowed, invoking s. ..... we had the benefits of hearing in this case besides ..... expression 'partner' will include also any person who, being a minor, has been admitted to the benefits of partnership. .....
Tag this Judgment!Court : Gujarat
Reported in : [1978]113ITR745(Guj)
..... concerned with the ambit and come of section 40(a)(v) and section 40(c) of the income-tax act, 1961, as were in force in the relevant assessment year 1969-70. ..... have been payable by such payment would have been payable by such employee) or any expenditure or allowance in respect of any assets of the assessee used by such employee either wholly or partly for his own purposes or benefit, to the extent such expenditure or allowance exceeds one-fifth of the amount of salary payable to the employee, on an amount calculated at the rate of one thousand rupees for each month or part thereof comprised in ..... of the director or of such person, as the case may be, (ii) any expenditure or allowance in respect of any assets of the company used by any person referred to in sub-clause (i) either wholly or partly for his own purposes or benefit, if in the opinion of the income-tax officer any such expenditure or allowance as is mentioned in sub-clauses (i) and (ii) is excessive or unreasonable having regard to the legitimate business needs of the company and the ..... in the second place, the construction canvassed by the revenue, apart from militating against the aforesaid rule of construction, would subject the expenses incurred by a company for providing benefit or amenity or perquisite to a director or employee to the twin scrutiny, namely, a prescribed ration applicable to an employee to the twin scrutiny, namely, a prescribed ration applicable to an employee and also the test of excessive and .....
Tag this Judgment!Court : Gujarat
Reported in : [1975]101ITR61(Guj)
..... what the actual cost to the assessee is. under section 43, sub-section (6) of the act, of 1961, 'written down value' means, (a) in the case of assets acquired in th previous year, the actual cost to the assessee; and (b) in the case of assets acquired before the previous year, the ..... thus the law has been significantly changed after the coming into force of the income-tax act, 1961, and even if the cost has been met directly or indirectly by any other person or authority as distinguished from government or local or public authority under the act, of 1922, such direct or indirect contribution from any other person or authority must be taken out from the actual cost in order to ascertain ..... any previous year, the assessee had received, whether in cash or in any other manner whatsoever, any amount in respect of such loss or expenditure or had obtained some benefit in respect of such trading liability by way of remission or cessation thereof, the amount received by him or the value of the benefit accrued to him was to be deemed to be profits and gains of business, profession or vocation and to have accrued or arisen during that previous year. 7. ..... nor any public or local authority and, therefore, for the assessment year 1961-62, even though there was cessation of liability, the assessee-company was entitled to have the benefit of the entire amount of rs .....
Tag this Judgment!Court : Gujarat
Reported in : [1980]124ITR448(Guj)
..... who has a substantial interest in the company, the ito has to disallow any such expenditure if, in his opinion, the expenditure is excessive or unreasonable having regard to the legitimate business needs of the company and the benefit derived by or accruing to it therefrom, so, however, that the deduction in respect of the aggregate of such expenditure and allowance in respect of any one person referred to in sub-clause (i) shall, in no case, exceed the ..... that the whole question, whether the expenditure on motor cars, both by way of expenditure as well as depreciation, was unreasonable or excessive having regard to the business needs of the company and the benefit derived by the company or accruing to the company from that expenditure can be gone into completely in the light of the evidence which the revenue or the assessee may be able to lead. ..... us for our opinion : 'whether, on the facts and in the circumstances of the case, the tribunal was right in law in applying the provisions of section 40(c)(ii) of the income-tax act, 1961, in upholding the disallowance made by the income-tax officer both in respect of motor car expenses as well as depreciation ?' 2. ..... any expenditure or allowance in respect of any assets of the company used by any person referred to in sub-clause (i) either wholly or partly for his own purposes or benefit', and the persons referred to in clause (i) are 'director and a person who has a substantial interest in the company or a relative of the director or of .....
Tag this Judgment!Court : Gujarat
Reported in : [1981]128ITR633(Guj)
..... act, 1961 ..... of any perquisite (whether convertible into money or not) to an employee or incurs directly or indirectly any expenditure or is entitled to any allowance in respect of any assets of the assessee used by an employee either wholly or partly for his own purposes or benefit, then, subject to the provisions of clause (b) so much of such expenditure or allowance as is in excess of the limits specified in respect thereof in clause (c) shall not be allowed as a deduction : provided that where the assessee is a company, so much of ..... amounts shall not be deducted in computing the income chargeable under the head 'profits and gains of business or profession', - (c) in the case of any company - (i) any expenditure which results directly or indirectly in the provision of any remuneration or benefit or amenity to a director or to a person who has a substantial interest in the company or to a relative of the director or such person, as the case my be, (ii) any expenditure or allowance in respect of any assets of the company used by ..... any person referred to in sub-clause (i) either wholly or partly for his own purposes or benefit, if in the opinion of the income-tax officer any such expenditure or allowance as is mentioned in sub-clause (i) and (ii) is excessive or unreasonable having regard to the legitimate business needs of the company and the .....
Tag this Judgment!Court : Gujarat
Reported in : [1978]112ITR64(Guj)
..... court held, in the facts and circumstances of the case, that interest paid by the assessee on monies borrowed for the purpose of purchasing plantations was not capital expenditure as no new asset was acquired nor enduring benefit obtained as a result of the payment of interest and that it was an expenditure laid out and expended wholly and exclusively for the purpose of plantations ..... if these tests are applied to the borrowing in the present case, it would be apparent that the assessee having acquired with it machinery, which was an equipment of enduring benefit to its manufacturing activity, the entire outlay including interest and other incidental charges which had to be incurred will be capital in nature ..... since the machinery was acquired and installed prior to devaluation, the said additional liability could be taken into account only for the purposes of granting depreciation allowance in view of section 43a(1) of the income-tax act, 1961 (hereinafter referred to as 'the act') ..... there is no need to resort to section 43a(1) and the provisions of section 43a(2) cannot, therefore, be pressed into service to deny to the assessee the benefit which was available to it under the provisions of section 33 itself. 29 ..... that the deduction as aforesaid was available to it on the plain terms of section 33, without having resort to section 43a, and the provisions of section 43a(2) could not, therefore, be pressed into service to deny to the assessee the benefit which was available to it under section 33. 12 .....
Tag this Judgment!Court : Gujarat
Reported in : [1976]104ITR510(Guj)
..... on the other hand, on behalf of the assessee, it is contended that the legislative intent underlying section 84 of the income-tax act, 1961, is to provide tax holiday to new industrial undertakings or hotels and for this purpose not merely the cost or value of capital is to be worked out, but the average capital employed throughout the year in the business of industrial ..... we deal with the contentions raised on behalf of the revenue, at the time of hearing of this reference, we would like to reproduce the relevant provisions of the income-tax act, 1961, and the rules which have a bearing on the point involved in this reference. 6. ..... however, the tribunal was of the opinion that the respondent-assessee was entitled under clause (5) of the aforesaid rule 19 to have benefit of further addition of half the amount of the profit in view of the fiction incorporated in the said clause (5). ..... incorporated in sub-rule (5) the assessee was entitled to the addition of half the amount of the profit to the total value and cost of the assets as computed under sub-rule (1) and that this may be additional benefit, was so intended to be conferred by the legislature, having regard to the fiction incorporated in sub-rule (5) ..... in respected of the assets during the previous year and the liabilities were also computed accordingly and, therefore, the profits were already reflected in the assets and it was, therefore, not necessary to give benefit again to the assessee by adding the amount the vidyanagar project. .....
Tag this Judgment!Court : Gujarat
Reported in : (1996)132CTR(Guj)404; [1996]219ITR550(Guj)
..... 80j of the it act, 1961, as the provision stood in the relevant assessment ..... in the present case also, no question had been raised before the authorities under the act and as it does not arise from the order of the tribunal whether the factory building itself can be 'plant', in the facts and circumstances of the present case, we are not dwelling into that question ..... of the it act, 1961. ..... allowance of development rebate is made only once in respect of the new machinery and a fixed percentage as prescribed in the act from time to time is allowed as a deduction form the profits of that year. ..... 43 under the 1961 act and the very fact that even books have been included in the definition of plant, the court came to be conclusion that the legislature intended to give a wider meaning to the word ' ..... in order to claim benefit of development rebate, the assessee contends that the factory premises itself must be held to be a plant and it cannot be treated as a building ..... 10(2) off the indian it act, 1922, corresponding to the provisions of s. 33 r/w ..... 10(5) of the 1922 act which is pari materia with sub-s. (3) of ..... section 32 of the act provides for depreciation in respect of building, machinery and plant or furniture owned by the assessee and used for the purpose of business or profession of the assessee during the previous ..... 33 of the act and cost of acquisition of new pumps and installation of drainage pipes for affluent disposal during the previous year ought to have been considered for allowing the .....
Tag this Judgment!