SAHARANPUR ELECTRIC SUPPLY CO. LTD. ETC. ETC. vs COMMISSIONER OF INCOME-TAX ETC.ETC.

The Supreme Court ruled that under Section 43 of the Income Tax Act, 1961, the actual cost of assets must be recalculated for each assessment year, including the exclusion of any amounts reimbursed by consumers. The Court upheld the High Courts' decisions that the actual cost for the assessment year 1962-63 and onwards must adhere to the definitions set forth in the 1961 Act, thereby rejecting the assessee's claim to retain earlier valuations. The judgment clarified that the statutory mandate requires a fresh determination of actual cost, which includes adjustments for contributions received, affirming the Revenue's approach.