Commissioner of Income Tax V. Hindustan Unilever Ltd.

ITA/677/2008

AI Insights

The case involves the Commissioner of Income Tax as the appellant and M/S Hindustan Unilever Ltd. as the respondent. The appellant challenged the ITAT's decision which favored the respondent on several grounds related to income tax deductions and expenditures. The main legal questions pertained to the interpretation and application of sections 80-IB, 43B, and 80HHC of the Income Tax Act, 1961. The High Court's decision referenced previous rulings on similar issues, thereby affirming the ITAT's decisions without introducing new interpretations or applications of the law.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 834934 (HC-CHANDIGARH)
• Appeal Type: Others
• Pronouncement Date: 05-02-2026
• Assessment Year: misc
• Other Referred Cases: Shital Fibers Limited Vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: ROHIT JAIN; ABHISHEK SHARMA
• Assessee Lawyers: URVASHI DHUGGA; VAIBHAV GUPTA; KAVITA
• Keywords: Deduction; Income Tax; Profit computation; Revenue expenditure; Tax duty
• Section: 43B; 80HHC; 260A; 80-IB

Judgement Text

" IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** 204 ITA-677-2008 (O&M) Date of Decision: 05.02.2026 COMMISSIONER OF INCOME TAX ...Appellant Vs. M/S HINDUSTAN UNILEVER LTD. …Respondents CORAM:- HON'BLE MR. JUSTICE JAGMOHAN BANSAL HON'BLE MR. JUSTICE AMARINDER SINGH GREWAL Present:- Ms. Urvashi Dhugga, Sr. Standing Counsel with Mr. Vaibhav Gupta, Jr. Standing Counsel and Ms. Kavita, Advocate for Income Tax Mr. Rohit Jain, Advocate (through V.C.) and Mr. Abhishek Sharma, Advocate for the assessee *** JAGMOHAN BANSAL, J. (ORAL) 1. The appellant through instant appeal under Section 260A of the Income Tax Act, 1961 (for short ‘1961 Act’) is seeking setting aside of order dated 28.05.2008 passed by Income Tax Appellate Tribunal, Chandigarh (for short ‘ITAT’). 2. The appellant has raised following questions for adjudication by this Court:- i. Whether on the facts and in the circumstances of the case the ITAT was right in law in upholding the order of the CIT (A) in deleting the disallowance of claim for deduction u/s 80-IB of the 1961 Act, in as much as the machineries had been installed in the same existing factory premises, which were in the nature of routine replacements with better capacity? ii. Whether on facts and in the circumstances of the case, the ITAT is right in law in treating the expenditure incurred on Printed from counselvise.com DEEPAK BISSYAN 2026.02.09 12:43 I attest to the accuracy and integrity of this document ITA-677-2008 -2- promotional and trade marketing as revenue expenditure, when the purpose of the expenditure & its intended reality is to obtain benefit of enduring nature? iii. Whether on the facts and circumstances of the case, the ITAT was right in allowing deduction u/s 43B of the 1961 Act for tax duty etc. on payment basis before incurring of the liability to pay such amounts? iv. Whether on the facts and circumstances of the case, the e ITAT was right in law in holding that for the purpose of computation of deduction u/s 80HHC profit is not to be reduced by profit allowed as deduction under section 80IB of the Act? 3. Learned counsel for the parties are ad idem that question No.1 stands answered by this Court vide order dated 19.01.2026 in ITA-269-2009, question No.2 by order dated 04.02.2026 in ITA-267-2009, question No.3 by order dated 04.02.2026 in ITA-325-2016 and question No.4 stands answered by Hon’ble Supreme Court in “Shital Fibers Limited Vs. CIT”, 2025 SCC OnLine SC 1178. 4. The questions raised by appellant are answered in terms of aforesaid orders of this Court and Supreme Court. 5. Pending application(s), if any, stands disposed of. (JAGMOHAN BANSAL) JUDGE (AMARINDER SINGH GREWAL) JUDGE February 05, 2026 Deepak DPA Whether Speaking/reasoned Yes/No Whether Reportable Yes/No Printed from counselvise.com DEEPAK BISSYAN 2026.02.09 12:43 I attest to the accuracy and integrity of this document "