Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (10) TMI 981 - ITAT MUMBAIDisallowance invoking the provisions of section 14A - HELD THAT:- The issue involved is covered in favour of the assessee as the assessee has not earned any exempt income. Reference in this regard may be decision of honourable Supreme Court in the case of Maxopp Investment Ltd vs CIT, New Delhi [2018 (3) TMI 805 - SUPREME COURT] Treatment of waiver of the amount of principal loan for working capital - HELD THAT:- If the working capital loan is used to finance working capital requirements, the bank finance used results in debit to the trading and profit & loss account for the concerned trading/working goods and services. In that case waiver of bank loan will not result in capital gain rather the provision of section 41(1) will be applicable. In this view of the matter in our considered opinion it is imperative that there is a finding as to what purposes the working capital loan has been utilised. In this regard learned Counsel of the assessee has submitted that part of the working capital loan has been utilized for acquisition of capital goods. We find that in this regard there is no clear cut finding by the assessing officer. In the case of Kapurchand Shrimal [1968 (8) TMI 16 - SUPREME COURT] has expounded that it is the duty of the appellate authority to correct the error in the orders of the authorities below and remit the matter for reconsideration with or without direction unless prohibited by law. In the present case accordingly we remit the issue to the file of assessing officer. The assessing officer is directed to give a finding on the utilisation of the working capital loan which has been waived by the bank and thereafter decide as per law. Accordingly the issue is remitted to the file of Assessing Officer with the above direction.
|