TMI Blog2013 (8) TMI 897X X X X Extracts X X X X X X X X Extracts X X X X ..... 47 of the IT Act. 2. The lone surviving ground No.1 raised by the revenue is reproduced herein below for consideration: 1. On the facts and circumstances of the case and in law, the ld. CI T(Appeals) erred in deleting the addition of ₹ 1.09 crores made u/s 41 (1) of the Act on account of remission or cession of trading liability in the case of TAFE. The ld. CIT(Appeals) erred in not appreciating the fact that TAFE had clamed bad debt on account of the said amount of ₹ 1.09 crores; and without writing off in their books, TAFE would not have claimed bad debt in their Income-tax proceedings for the A. Y. 2003-04. 3. The assessee is a Private Limited Company engaged as dealer of tractors filed its return of income on 23-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial that TAEF has filed suit in the court of law. From the details filed by the assessee, the nature of suit also nature of dispute with TAFE is not ascertainable. Assessee s contention that the company has yet not obtained any benefit as as the suit is pending is not acceptable as per the information available on records, the TAFE has already written off the liability for the assessee. From the details available on records, it is clear that TAFE has written off the liability of the assessee company and therefore as per provision of the section 41(1) the assessee was required to offer ₹ 1.09 crores for taxation as per section 41(1). The case laws cited by the assessee are differed than the facts of the case of the assessee. Consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uit of recovery filed by it in the High Court of Madras in July, 2002, an amount of ₹ 1,30,28,190/- was due and payable by the appellant. Copy of this plaint and affidavit was filed by the appellant before the Assessing Officer also. In para 10 of plaint, it was stated by TAFE that this amount was due and payable by the appellant to TAFE for goods sold and supplied. The Assessing Officer also collected from TAFE, ledger account statements of appellant in the books of TAFE from A. Y. 2001-02 onwards, which are available on assessment record. As per these ledger accounts, appellant owed around ₹ 1,39,00,000/- to TAFE as on 31.3.2003. Appellant s debt was not written off in these ledger accounts by TAFE, even though a claim of bad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. We have heard the rival submissions and carefully perused the orders of the revenue authorities along with the paper book furnished by the assessee. On our perusal, we find that the AO disallowed the claim of the assessee on the ground that the assessee has not filed any supporting evidence to show the nature of dispute between the assessee and TAFE. However, the ld.CIT(A) has given a finding on fact that as per TAFE s plaint and affidavit in connection with Civil Suit of recovery filed by it in the Hon ble High Court of Madras in July-2002, amount of ₹ 1,30,28,190/- was due and payable by the assessee. Copy of this plaint and affidavit was filed by the appellant before the AO also. It is also recorded by the ld.CIT(A) that in p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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