| Case ID |
2d393a7b-2c0b-454a-b073-a13d08d797ea |
| Body |
View case body. Login to View |
| Case Number |
N/A |
| Decision Date |
Jan 01, 1988 |
| Hearing Date |
|
| Decision |
The Tribunal's decision was upheld, affirming that the weighted deduction under section 35B could not be allowed on amounts of freight and insurance charges. The decision also confirmed that the written down value of depreciable assets should be used for computing capital employed under section 80J, and that the surtax liability for the year could not be deducted in calculating total income. The case was decided against the assessee, and the court provided a certificate for appeal to the Supreme Court regarding the second question. |
| Summary |
This case revolves around the interpretation of the Income-tax Act, 1961, specifically sections 35B, 80J, and 40(a)(ii). The Calcutta High Court examined whether the Tribunal was correct in disallowing a weighted deduction on freight and insurance charges, ruling that such deductions were not permissible. The court also clarified that the written down value, rather than the original cost, should be considered for capital employed calculations under section 80J. Furthermore, it was determined that surtax liability could not be deducted while calculating total income. The court's ruling was consistent with previous case law, reinforcing the principles of tax deductions in corporate taxation. This case is significant for companies seeking deductions related to exports and industrial undertakings, as it delineates the boundaries of allowable deductions under the Income-tax Act. |
| Court |
Calcutta High Court
|
| Entities Involved |
Commissioner of Income Tax,
Organon (India) Ltd.
|
| Judges |
Satish Chandra, C.J.
|
| Lawyers |
Miss Seal for the Applicant,
S.K. Chakraborty for the Respondent
|
| Petitioners |
Organon (India) Ltd.
|
| Respondents |
Commissioner of Income Tax
|
| Citations |
1988 SLD 1674,
(1988) 172 ITR 354
|
| Other Citations |
Bharat General & Textile Industries Ltd. v. CIT [1985] 153 ITR 747 (Cal.),
Molins of India Ltd. v. CIT [1983] 144 ITR 317 (Cal.)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
35B,
80J,
40(a)(ii)
|