CIT v. Nicholas Piramal (India) Ltd.
Case data and operative result
Repository ID: F2J-C-0197
Court / Tribunal: Bombay High Court
Case number: itxa-1586-2013
Decision date: —
Law family: Income Tax
Outcome category: Dismissed
Sections / provisions: 37(1); Section 260
Extractive case note
IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 1586 OF 2013 The Commissioner of Income Tax 7 V/s. M/s. Nicholas Piramal (India) Ltd. Mrs. S. V. Bharucha, for the Appellant. Mr. J. D. Mistry, Sr. Advocate with Mr. Neeraj Sheth and Mr. A. K. Jasani, for the Respondent. CORAM: M.S.SANKLECHA, & N.M.JAMDAR, JJ. DATE : 10th JUNE, 2015. P.C: This Appeal under Section 260A of the Income Tax Act, 1961 (the Act), challenges the order dated 15 th March, 2013 passed by the Income Tax Appellate Tribunal (the Tribunal) for the Assessment Year 199899. 2 for our consideration: “(a) Whether on the facts and circumstances of the case and in law, the Tribunal was justified in allowing the deduction of the entire expenditure of Rs.14,42,654/ incurred under the head community development expenditure as business expenditure even though the same were not incurred wholly and exclusively for the purpose of the business? (b) Whether on the facts and circumstances of the case and in law, the Tribunal was justified in holding that the expenditure incurred by the assessee in A. Y. 199697 is allowable in the S.R.JOSHI had during the year under consideration claimed deduction on the aggregate of Rs.14.42 lakhs under the head 'community development expenditure. This expenditure was for providing street lights on the road which leads to the Respondent's factory, providing ambulance for meeting medical emergencies for residents of the village where its factory is and developing a public garden. The aforesaid expenditures were disallowed by the Assessing Officer on the ground that the same are not incurred wholly and exclusively for the purpose of Respondent's business. 5
Operative-result extract
appeal is dismissed. No order as to costs.
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Case in 2 minutes
The judgment addresses the issues identified in the case record.
Case snapshot
Sections / provisions: 37(1)
Questions before the Court / Tribunal
- See the source-driven case record below.
Material facts and background
Mrs. S. V. Bharucha, for the Appellant. Mr. J. D. Mistry, Sr. Advocate with Mr. Neeraj Sheth and Mr. A. K. Jasani, for the Respondent. CORAM: M.S.SANKLECHA, & N.M.JAMDAR, JJ. DATE : 10th JUNE, 2015. P.C: This Appeal under Section 260A of the Income Tax Act, 1961 (the Act), challenges the order dated 15 th March, 2013 passed by the Income Tax Appellate Tribunal (the Tribunal) for the Assessment Year 199899. 2
had during the year under consideration claimed deduction on the aggregate of Rs.14.42 lakhs under the head 'community development expenditure. This expenditure was for providing street lights on the road which leads to the Respondent's factory, providing ambulance for meeting medical emergencies for residents of the village where its factory is and developing a public garden. The aforesaid expenditures were disallowed by the Assessing Officer on the ground that the same are not incurred wholly and exclusively for the purpose of Respondent's business. 5
Appellant / assessee submissions
The judgment copy does not separately set out this component in a distinct section; refer to the full order and the reasoning section below.
Revenue / respondent submissions
The judgment copy does not separately set out this component in a distinct section; refer to the full order and the reasoning section below.
Court / Tribunal analysis and reasoning
of the Madras High Court in Commissioner of Income Tax v/s. Madras Refineries Ltd., 266 ITR 170 held that the concept of business is not static and over a period of time, it would include within its fold the care and concern for the society at large which would result in a goodwill being created in its favour leading to better business. The Madras High Court in Madras Refineries (supra) had allowed expenditure incurred on drinking water facilities and aid to the school. Therefore, in the present case also, expenditure incurred for community is for the purpose of S.R.JOSHI
Operative decision and relief
Assessing Officer disallowing the expenditure of Rs.14.42 lakhs for community development. 6
of the Madras High Court in Commissioner of Income Tax v/s. Madras Refineries Ltd., 266 ITR 170 held that the concept of business is not static and over a period of time, it would include within its fold the care and concern for the society at large which would result in a goodwill being created in its favour leading to better business. The Madras High Court in Madras Refineries (supra) had allowed expenditure incurred on drinking water facilities and aid to the school. Therefore, in the present case also, expenditure incurred for community is for the purpose of S.R.JOSHI
business. This is in effect, a finding of fact and the Revenue is unable to show, it is perverse. Thus, no fault can be found with the order of the Tribunal. 7
Authorities and precedents appearing in the judgment
- No reliable precedent list was extracted automatically; use the full judgment for the citation chain.
This list is machine-assisted from the judgment text and is not a substitute for checking the full citation chain in the PDF.
Ratio and legal principle
The decision turns on the statutory and factual issues recorded above. The operative result is classified as Dismissed. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.
Why this judgment matters
The case is relevant to taxpayers, advisers and litigators dealing with Income Tax. Its practical value lies in the interaction between the statutory text, the evidentiary record and the procedural route followed in this case.
Practitioner action points
- Use the judgment as a fact-specific precedent: match the statutory version, assessment period, procedural stage and evidentiary record before relying on the result.
- Check whether a later High Court/Supreme Court order has affirmed, reversed, distinguished or rendered the decision academic.
- For litigation, attach the full judgment/order to the working paper and cite the paragraph/page supporting the proposition rather than relying on a headnote alone.
Do not over-read this case
- The packaged PDF is not yet an issuing-authority certified copy
- Apply the statutory law applicable to the relevant year; later amendments can change the result.
- Check whether a later High Court or Supreme Court judgment has affirmed, distinguished, reversed or superseded this decision.
How to apply this decision in practice
This Bombay High Court decision should be used by matching the client’s facts to the precise controversy in the case—the disputed issue—rather than by relying only on the result. Start with the statutory version applicable to the relevant year and compare it with 37(1). Amendments, notifications, later Supreme Court/High Court decisions and a different procedural stage can materially change the answer.
For an assessment or litigation file, retain the documents that prove the factual bridge on which the judgment turns: the original notice/order, replies and objections, acknowledgements of filing/service, ledger and banking trail where relevant, contracts or property instruments where relevant, and the complete appellate chronology. If the case succeeds on jurisdiction or natural justice, do not assume the same outcome where the authority cures that defect. If it succeeds on evidence, identify exactly which documents the Court or Tribunal considered persuasive.
Before citing the case, verify the latest appellate status and whether the decision is final, distinguished, stayed, reversed or confined to its facts. The packaged PDF and source trail should be read together with the current statutory text.
Finin2min reliance rule: cite the case for the narrow legal proposition actually decided, record any contrary authority, and attach the full judgment to the working paper or litigation file. This reduces the risk of a headnote or short summary being used outside its factual and statutory context.
Verification before citation
Because this is a comparatively short order, the practical value lies in its precise procedural and factual setting rather than its length. Before citing it, compare the complete paper-book chronology, the statutory wording for the relevant year, the forum’s jurisdiction and any later appellate history. A short order can be decisive, but only for the proposition actually adjudicated. Finin2min therefore provides the full judgment PDF alongside this note so the primary reasoning can be checked rather than inferred from the summary alone.
Finin2min Judgment Intelligence
Decision support built around the judgment: reliance, fact match, Q&A, section impact, related-case network and practical next steps.
Can I rely on this judgment?
| Authority level | High Court |
|---|---|
| Reliance effect | Binding within the High Court’s territorial jurisdiction on subordinate authorities; persuasive elsewhere, subject to Supreme Court law. |
| Source integrity | A sanitized local full-text judgment copy is packaged; official-primary replacement remains pending. |
| Subsequent history | Subsequent appellate history is not fully closed in the current ledger. Recheck before filing or opinion work. |
| Finin2min status | Later-history check open |
Does this case match your facts?
Stronger match when
- Your dispute raises the same core issue: the principal issue.
- The same statutory provisions or materially equivalent provisions apply: 37(1).
- Your matter is at a comparable the same procedural and factual stage stage.
- Your documentary/evidentiary record is materially similar to the facts the Bombay High Court considered: Mrs.
- The same legal regime or assessment-period rules relevant to AY 1998-99 apply to your matter.
Weaker / distinguishable when
- A later Supreme Court or jurisdictional High Court ruling changes the legal position.
- The statutory provision was amended for your year or transaction.
- Your evidence, transaction structure, notice chronology or procedural stage differs on a fact the judgment treated as material.
- The case succeeded on a narrow jurisdictional/procedural defect that the authority has cured in your matter.
Questions this judgment answers
What was the main dispute in CIT?
The judgment addresses the issues identified in the case record.
Which facts mattered most to the result?
Mrs. S. V.
What did the Bombay High Court ultimately decide?
Assessing Officer disallowing the expenditure of Rs.14.42 lakhs for community development. 6 of the Madras High Court in Commissioner of Income Tax v/s. Madras Refineries Ltd., 266 ITR 170 held that the concept of business is not static and over a period of time, it would include within its fold the care and concern for the society at large which would result in a goodwill being created in its favour leading to better business.
What legal principle can be taken from this judgment?
The decision turns on the statutory and factual issues recorded above. The operative result is classified as Dismissed. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.
Which provisions should be checked before relying on the case?
The case engages 37(1). The relevant statutory version for AY 1998-99 should be checked together with any later amendment, notification, circular and controlling higher-court authority.
When is this judgment most useful to a taxpayer or adviser?
The case is relevant to taxpayers, advisers and litigators dealing with Income Tax . Its practical value lies in the interaction between the statutory text, the evidentiary record and the procedural route followed in this case.
What could make this judgment distinguishable or unsafe to rely on?
The packaged PDF is not yet an issuing-authority certified copy Apply the statutory law applicable to the relevant year; later amendments can change the result. Check whether a later High Court or Supreme Court judgment has affirmed, distinguished, reversed or superseded this decision.
Can this judgment be cited as current law without another check?
Binding within the High Court’s territorial jurisdiction on subordinate authorities; persuasive elsewhere, subject to Supreme Court law. Subsequent appellate history is not fully closed in the current ledger. Recheck before filing or opinion work. A sanitized local full-text judgment copy is packaged; official-primary replacement remains pending.
Section / provision impact
- 37(1) — 37(1) is part of the statutory framework considered in the context of the dispute. Read the exact provision applicable to the relevant year with the Court/Tribunal reasoning.
How the decision changes your analysis
Before using this authority, frame the issue under 37(1) and identify the decisive facts/evidence. The result should not be assumed from the case title alone.
The decision turns on the statutory and factual issues recorded above. The operative result is classified as Dismissed. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.
Binding within the High Court’s territorial jurisdiction on subordinate authorities; persuasive elsewhere, subject to Supreme Court law. Subsequent appellate history is not fully closed in the current ledger. Recheck before filing or opinion work.
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Related cases with a different result
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Working-paper citation
Full judgment and source trail
Read / download the clean local judgment copy
| Packaged source class | Sanitized local full-judgment copy; official primary replacement pending |
|---|---|
| Pages | 3 |
| SHA-256 | 21c5f8a001740e5d79c1cc0cc2445602ab6c0cf3c05a3295281d0487cbcd2a97 |
| Local document URL | Open the packaged local document |
| Source authentication | Sanitized local full-text copy - official primary replacement pending |
Related Finin2min guidance
Sections and statute
The numbered references below belong to the statutes and versions identified in this judgment. They are citation labels, not a crosswalk to same-number sections of the Income-tax Act, 2025.
Section 260