LexCOMMISSIONER OF INCOME TAX, UDAIPUR, RAJASTHAN versus MCDOWELL & CO. LTD.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
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[2009] 8 S.C.R. 983
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COMMISSIONER OF INCOME TAX, UDAIPUR,
A
RAJAS THAN
V.
MCDOWELL & CO. LTD.
(Civil Appeal No.2939 of 2006)
MAY 8, 2009
B
If )(
[DR. ARIJIT PASAYAT AND DR. MUKUNDAKAM
SHARMA, JJ.]
Income Tax Act, 1961:
c
s.438 - Unpaid amount of bottling fee on furnishing of
thei bank guarantee, not to be treated as actual payment and
not entitled to deduction u/s.438.
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D
Bottling fees chargeable from assessee under the Rules
frnmed under the Rajasthan Excise Act and interest
chargeable on late payment of bottling fees does not amount
to tax, duty, cess or fees within the meaning s.438.
Depreciation on research and development assets which
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related to the closed business of fast food division/unit of the
.../
as.sessee-company and as such not used during the previous
)
year -
Entitlement to deduction - Held: Issue whether
machinery was used in respect of both the fast food and liquor
units was not examined in detail -
Matter remitted to
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assessing officer to examine this aspect - If it is established
that whole or part of machinery was used for liquor unit whether
partly or fully in respect of those machineries the deduction
can be made as permissible in law.
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.,; '~
Expenditure incurred in purchase of new transformer
even when the old transformer still existed in the blocks of
asset and not sold, discarded or demolished or destroyed -
Entitlement to deduction - Held: Tribunal and High Court· did
983
H
984
SUPREME COURT REPORTS [2009) 8 S.C.R.
A not deal with factual aspects in detail - Matter remitted to
J
""
Assessing Officer.
Technical service charges payment under consideration
whether allowable based on subsequent agreement at higher
B rate - Held: Tribunal and High Court recorded a finding that
new agreement was not clandestine device to reduce the tax
liability but was an expenditure incurred on business
Jo(" ,.
expediency and decision of parties to enter into agreement
was based on commercial consideration - Such finding was
c finding of fact on cogent assessment - No interference called
for.
Amar Chandra v. Collector of Excise, Tripura AIR (1972)
SC 1863; Housing Board of Haryana v. Haryana AIR (1996)
SC 434; State of Bombay v. F.N. Balsara AIR (1951) SC 318;
D Har Shankar v. Dy. Excise and Taxation Commissioner AIR
~ " ~-
(1975) SC 1121; State of U.P. v. Sheopat Rai AIR (1994) SC
813; Ahmedabad Urban Development Authority v. Sharad
Kumar Jayantgi Kumar Pasawalla AIR (1992) SC 2038;
Commissioner of Income Tax v. Ramaraju Surgical Cotton
E Mills (2007) 294 ITR 328 SC, relied on.
Commissioner of Income Tax, Madurai and Ors. v.
Saravana Spinning Mills (P) Ltd. (2007) 7 SCC 298;
\...
Commissioner of Income Tax v. Rajasthan Patrika Ltd. 258
~
F -ITR 300, referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
2939 of 2006.
From the Judgment & Order dated 09.10.2003 of the High
G Court of Rajasthan at Jodhpur in I. T. A. 77 of 2001.
With
.__ ....
C.A. No. 3471, 3472, 3473, 3511, 3512 of 2007.
H
\
COMMISSIONER OF INCOME TAX, UDAIPUR, RAJASTHAN 985
v. MCDOWELL & CO. LTD.
p
. P.V. Shetty, H. Raghvendra Rao, Ashish Jain, B.V.
A
"
Balaram Das and B.K. Prasad for the Appellants.
S. Ganesh, Anjali K. Verma, Neeraj Gupta and Meera
Mathur for the Respondents.
The Judgment of the Court was delivered by
B
. .- i.
DR. ARIJIT PASAYAT, J. 1. Questioning correctness of
the judgment rendered by a Division Bench of the Rajasthan
High Court at Jodhpur this appeal has been filed. Originally
following questions were framed for adjudication by order dated c
24.fi.2002:
1. Whether on the facts and in the circumstances of
the case, the ITAT was justified in deleting the addition of
: > j_
Rs.5,61,462/- by holding that unpaid amount of bottling fee
D
has, on furnishing of bank guarantee, to be treated as
actual payment and accordingly the deduction in respect
of the same cannot be deemed under section 438 of the
IT Act, 1961?
2. Whether, on the facts and in the circumstances of
E
the case, the IT AT was justified in deleting the addition of
-+
Rs.61,412 made by the Assessing Officer on account of
,)
disallowance of landscaping expenses not recovered u/s
Section 35(1}(iv) of the Income Tax Act by wrongly relying
on the decision in ITA No.1546/JP95 dtd. 30.03.2001 ?"
F
2. Subsequently a third question was framed which reads
as follows:
3. "Whether, in the facts and circumstances of the
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