Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (2) TMI 974 - AT - Income TaxAddition of Provisions for trade receivable as debited to P&L account under the head "other expenses" - HELD THAT:- Trade receivables which stood as on 31/03/2014 is substantially reduced as on 31/03/2015 which clearly indicates that assessee should have received the payment from the trade receivables or assessee must have written off the above said balances. From the P&L Account, the details submitted under the head ‘Other expenses’ which carried narration ‘Provision for trade receivables’. When compared with the balance-sheet figure of trade receivables, it clearly indicate that assessee has actually wrote off the trade receivables and claimed bad debt. Just because the narration used by the assessee as ‘provision for trade receivables, but in fact, it is only actual loss / expenditure claimed by the assessee which can be classified under the head ‘bad debts’ as per section 36(1)(vii) of the Act, we have to consider substance over the form and the intention of the assessee has to be appreciated and not the nomenclature noted to claim the expenses, it has merely mentioned the term ‘provision’ it does not mean that it becomes provision. Therefore, we direct the assessing officer to delete the addition as it actually pertains to bad debts written off in the books of account. - Decided in favour of assessee.
|