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2020 (3) TMI 1166 - AT - Income TaxDisallowance of bad debts and advances written off - HELD THAT:- We find that this Tribunal in assessee’s own case for A.Y. 2006-07 set aside the issue of disallowance on account of write off of advances - In CIT vs. Calcutta Agency Ltd. [1950 (12) TMI 4 - SUPREME COURT] it was held that the burden of proving the necessary fact in order to entitle the assessee the claim exemption was on the assessee. Bad debts written off - we find that the issue is settled by Hon'ble Apex Course in the case of TRF Ltd. Vs. CIT [2010 (2) TMI 211 - SUPREME COURT]. It was held in the said case that writing off of advances in the aforesaid account is sufficient compliance for provisions of the Act. However, in the present case, it was noted that the assessee has not furnished names of the debtors to the Assessing Officer, hence we remit this issue also to the file of the Assessing Officer if details of bad debts actually written off in the books are available the same is to be allowed as per ratios emanating out of the order of Hon'ble Supreme Court as above. Disallowance of expenditure incurred on fixing barricades while computing capital gains - HELD THAT:- Both the authorities are making contradictory remarks only based upon their surmises. Learned CIT(A) has further erred in observing as to how barricades can improve the quality of land and cause to improvement of any kind. Here we find that as submitted by the assessee the barricades were necessary to earmark land to be sold. That lands are demarcated by barricades is well known phenomena. In the present situation everybody wants his land to be demarcated by identified barricades. People do not generally sit idle and go by demarcation of land in revenue records. It is naive to assume that people rest upon demarcation of land in land records without making barricades of their own for the various purposes of protection of land, ease in selling it and saving from encroachment etc. Authorities below have totally erred in this regard and impugned expenditure is allowable. Hence, we set aside the orders of the authorities below and decide the issue in favour of the assessee. Addition on sale of Transferable Development Rights (TDR) - AO noted that despite receiving income the assessee has not offered the same to tax - assessee had to surrender 27% of the vacant plot and in lieu thereof subsequently it got TDR - CIT(A) deleted the additions - HELD THAT:- AO observed that it is the contention of the assessee that receipt on sale of TDR is on surrender of land in earlier years and the capital gain on such transfer of land has already been offered by the assessee in the year in which transfer took place. He rejected the assessee’s contention that since the cost of such TDR is nil, there is no capital gain. He noted that the assessee is having the ownership of the plot and on sale of such plot the assessee received the sale consideration as well as other benefit in the form of TDR on such plot of land, which is just like a receipt of bonus shares in respect of shares held. With promulgation of development control rules (DCR) it acquired right of putting up additional construction through transferable development rights (TDR). Instead of utilizing this right itself, the assessee decided to transfer the same to a developer for construction of new building. This right created by the DCR was held to be not giving rise to any capital gains. We note that on the other hand the facts of the present case are that it was in lieu of surrender of 27% of vacant plot to MHADA that the assessee received TDR. Hence, facts of the present case are totally different and the cost is very much evident therein as the assessee had to surrender part of the plot owned by it. Furthermore other decisions referred by learned Counsel of the assessee are also in the same background. Distinguishing feature of the present case is that the assessee had to surrender 27% of the vacant plot and in lieu thereof subsequently it got TDR. Hence CIT(A)’s order is nonspeaking and laconic cannot be sustained. We deem it appropriate to remit this issue to the file of the learned CIT(A). Learned CIT(A) is directed to consider the issue afresh after taking into account actual facts arising in this case and thereafter decide as per law. The assessee is at liberty to make further submission before learned CIT(A) in support of its case - Appeals are partly allowed for statistical purposes.
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