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2011 (5) TMI 578 - AT - Income TaxDisallowance of rural development expenditure - Held that:- The impugned issue has been decided by the Tribunal in assessee's own case against the assessee and in favour of the revenue following the earlier order of the Tribunal for the Assessment Years 1990-91 to 1993-94 thus respectfully following the consistent view of the Tribunal the disallowance made by the AO upheld - Appeal is rejected Disallowance of provisions for contractual liability towards the third party converters - Held that: As decided in assessee's own case vide order dated 30.6.2010 that the said liability was a contingent liability and it was not deductible while computing the income of the assessee and accordingly confirmed the disallowance made by the AO - against assessee. Bad debts claim - disallowance as assessee has not furnished the details of doubtful bad debts - Held that:- As decided in T.R.F. LTD. Versus COMMISSIONER OF INCOME-TAX [2010 (2) TMI 211 - SUPREME COURT] to obtain a deduction in relation to bad debts, it is not necessary for the assessee to establish that the debt, in fact has become irrecoverable. It is enough of the bad debt is written off as irrecoverable in the accounts of the assessee - as the AO, in absence of any relevant details, has not examined the issue it is to be send back the matter to the file of the AO to examine the same afresh - in favour of assessee by way of remand. Unrecorded sales - Held that:- Nothing is found during the course of survey to show that the assessee has made a sale out of the books of account. The milk fat is subject matter of excise regulations and assessee is showing the same to the excise authorities and the said record. i.e. excise register etc supports the case of the assessee that whatever the production of the milk fat is shown is correct. Also as per the statement filed by the assessee, the assessee has given the detailed break-up of the cans. There is also some force in the argument of Ld. Counsel that the weight of each and every filed-in can is not taken. There is some variation and it cannot be presumed that in each and every can the weight of the milk fat is 50 KGs. Even presuming that each and every can is having the milk fat of 50 Kgs. then on the basis of the production log-sheet, the total fat produced during the year come to 4,17,476 kgs. only and while as per the excise register the total milk fat production is declared at 4,70,674 kgs. Thus production log sheet (PLS) which was found during the course of survey action cannot be said to be conclusive as even as per the AO it is normally 50Kgs. In the absence of any distinguishing features brought on record by the revenue appeal decided in the favour of assessee Regarding deduction u/s 80HHC - Held that:- Respect fully following the order of the Tribunal in assessee's own case direct the AO that the miscellaneous income shown by the assessee should be included in the total turnover. However, with regard to the exclusion of 90% of the said income while computing the profits of the business the decision in CIT V/s K.Ravindranathan Nair [2007 (11) TMI 10 - SUPREME COURT OF INDIA] is to follwed to hold that the same should also be reduced from the business profits for the purpose of Clause (baa) of Explanation to Section 80HHC - against assessee. Claim received from insurance, interest, other income and octroi refund - computation of deduction u/s 80HHC - Held that:- As assessee has failed to show that the receipt of interest, other income and octroi refund has nexus with the export of the assessee AO was justified in excluding 90% of the receipt of all in view of the Explanation (baa) to section 80HHC. With regard to the amount of insurance claim, in the absence of any details the issue remitted back to the file of the AO to verify the same and decide the issue afresh in the light of the decision of the Hon. Jurisdictional High Court in the case of CIT V/s Pfizer Ltd. (2010 (6) TMI 433 - BOMBAY HIGH COURT) - partly in favour of assessee. Netting off interest received from the Income Tax Department and paid to the Department - Held that:- As in Sandvik Asia Ltd. Versus JCIT, Spl. Range 5, Pune [2011 (11) TMI 509 - ITAT PUNE] AO was directed to tax only the net interest income in the hands of the assessee - as CIT(A) has not dealt with the issue send the matter back his file to decide the issue afresh - in favour of assessee by way of remand.
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