| Case ID |
3211b4f5-76d0-4dbe-b9d5-144074f67e0d |
| Body |
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| Case Number |
TAX CASE No. 33 OF 1977 |
| Decision Date |
Sep 27, 1982 |
| Hearing Date |
|
| Decision |
The court held that the payment of urban land tax for the period from 1-7-1963 to 1-7-1970 was admissible as a deduction while computing the rental income under the head 'Other sources' for the assessment year 1971-72. The Tribunal's decision to allow the deduction was based on the principle that the actual payment of tax is what matters for deduction, regardless of the period it relates to, as long as the payment was made in the relevant assessment year. This was affirmed by referencing earlier cases which supported the notion of deductibility based on actual payment rather than on the accrual basis. The court concluded that the urban land tax was a deductible expenditure under section 57(iii) from the income received from other sources, specifically from the rental income. |
| Summary |
This case revolves around the deductibility of urban land tax under the Income-tax Act, 1961. The primary contention was whether the urban land tax paid by the lessee could be deducted from the rental income assessed under 'Other sources.' The court ruled in favor of the taxpayer, emphasizing the significance of actual payment over the period it pertains to. The ruling aligns with principles established in previous judgments, reinforcing the taxpayer's right to deductions that are incurred in the process of earning income, thereby promoting fair taxation practices. This case underscores the importance of understanding tax liabilities and the provisions of the Income-tax Act, particularly sections 145 and 57(iii). |
| Court |
Madras High Court
|
| Entities Involved |
Not available
|
| Judges |
G. RAMANUJAM,
G. MAHESHWARAN
|
| Lawyers |
Mrs. Nalini Chidambaram,
N.V. Balasubramanian
|
| Petitioners |
Commissioner of Income Tax
|
| Respondents |
P.J. Irani
|
| Citations |
1983 SLD 1169,
(1983) 143 ITR 540
|
| Other Citations |
CIT v. M. Ct. Muthiah [1979] 118 ITR 104 (Mad.),
CIT v. Woodlands Hotel [1981] 128 ITR 603 (Mad.),
Indian Aluminium Co. Ltd. v. CIT [1972] 84 ITR 735 (SC),
T.S. Krishna v. CIT [1973] 87 ITR 429 (SC),
Usher's Wiltshire Brewery Ltd. v. Bruce [1915] 6 TC 399 (HL),
CIT v. Chandulal Keshavlal & Co. [1960] 38 ITR 601 (SC),
CIT v. Royal Calcutta Trust Club [1961] 41 ITR 414 (SC),
Eastern Investments Ltd. v. CIT [1951] 20 ITR 1 (SC)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
145,
57(iii)
|