Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2013 (8) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (8) TMI 44 - HC - Income TaxBad debts u/s 36 - A.O. held amount as capital investment - CIT upheld addition - Tribunal deleted addition - Held that:- assessee is engaged in the business of money lending. The income earned from the illegal business is also taxable income - There is a loss to the assessee as both the companies in which assessee made deposits have closed down their business and disappeared from town. Recovery of the amount in question is not possible. So, the assessee had written off the amount in the books of accounts as "bad debt" - to treat the debt as a bad debt had to be a commercial or business decision of the assessee based on the relevant material in the possession of the assessee. Once the assessee records the debt as a bad debt in his books of account that would prima facie establish that it was a bad debt unless the Assessing Officer for good reasons holds otherwise - Following decision of Director of Income Tax (International Taxation) vs. Oman International Bank [2009 (2) TMI 54 - BOMBAY HIGH COURT], CIT vs. Sri Ram Gupta [2005 (5) TMI 64 - ALLAHABAD High Court] and TRF Ltd. vs. CIT [2010 (2) TMI 211 - SUPREME COURT] - Decided against Revenue.
|