Supreme Court of India · 1972-03-29
THE INDIAN ALUMINIUM CO. LTD vs C.I.T., WEST BENGAL, CALCUTTA
- Citation / case number
- SC 1968/60340
- Court
- Supreme Court of India
- Petitioner
- THE INDIAN ALUMINIUM CO. LTD
- Respondent
- C.I.T., WEST BENGAL, CALCUTTA
- Author
- SIKRI, S.M. (),GROVER, A.N.,RAY, A.N.,PALEKAR, D.G.,BEG, M. HAMEEDULLAH
- Bench
- SIKRI, S.M. (CJ),GROVER, A.N.,RAY, A.N.,PALEKAR, D.G.,BEG, M. HAMEEDULLAH
Judgment text excerpt
The Supreme Court held that the payment of wealth tax by a trading company can be deducted as a business expense under Section 10(1) and Section 10(2)(xv) of the Income Tax Act, 1922. The Court modified the test established in Travancore Titanium Products Ltd. v. C.I.T., emphasizing that when a trader pays taxes on property used for trade, it should be considered as an expense incurred in the capacity of a trader. The judgment clarified that if the expenditure is incidental to the business, it must be treated as such, thereby allowing the appeal of the assessee.