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2016 (1) TMI 1128 - AT - Income TaxAddition on account of disallowance of quality claim expenses - CIT(A) deleted the addition - Held that:- It is not even in dispute that the quality claim were made. As for the Assessing Officer’s stand that in view of debit note sent by the buyer, the assessee should have reduced its sale and only shown the net figure of sales, we find that whether gross sales is shown on the credit side, with a quality claim shown on the debit side, or whether a net sale figure is shown effect is the same. His hyper technical objection does not our approval. Learned Departmental Representative has now given a new twist to the matter. He submits that since all the foreign bills were purchased by the buyer, and the assessee had already received the sale proceeds, there was no loss to the assessee. This argument, however, proceeds on the fallacious assumption that banker purchases bills drawn on the buyer, and he has no recourse to the assessee. Even though in the banking terminology such transactions of loan against receivables from foreign buyers are sometimes termed as FDBP (Foreign Documentary Bills Purchased), these are essentially nature of loans to exporters. Nothing, therefore, turns on the receipt of loans in respect of bills raised by the assessee. These are not revenue receipts at all, nor was it ever the case of even the Assessing Officer, on the light of these discussions, we approve the well reasoned of the CIT(A) and decline to interfere in the matter. - Decided against revenue
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