Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (6) TMI 1298 - AT - Income TaxLoss on sale of shares - Assessee had debited ‘loss on sale of investments’ which being long term capital gains should not be allowed as business loss - Held that:- AO himself had assessed the income or loss on account of sale under the head ‘profit & gains from business’ instead of ‘income of capital gains’ shown by assessee, which has been followed by assessee consistently. AO has not given any reason except stating that the assessee had shown the said shares as long term investments in the balance sheet. CIT(A) observed that assessee has been showing said shares as investments in the balance sheet and since the department had altered the nature of income from capital gains to business income, assessee accepted the said decision of the department and has been offering the income under the head ‘business’, though the said shares have been continued to be shown as investments in the balance sheet. Facts have not been different to the earlier A.Ys. 1992-93 & 1993-94, wherein Assessing Officer himself treated the sale of shares as business income/loss. AO cannot keep changing the head of income without bringing new material on record. Therefore, loss on sale of shares was rightly directed to be treated as business loss. Disallowance of bad debts - Held that:- Since the provision was debited in P&L account last year the same was not debited once again in the P&L account this year. Instead the assessee claimed deduction only in the computation of income for A.Y. 2005-06. Assessee explained necessary entries were passed in the books of account with reference to write off of bad debts. The entries passed by assessee have been verified and found to be correct. So, following the decision of Hon'ble Supreme Court in the case of TRF Ltd. vs CIT [2010 (2) TMI 211 - SUPREME COURT], the addition made on account of bad debts written off was rightly deleted by CIT(A). - Revenue appeal dismissed.
|