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2016 (5) TMI 706 - AT - Income TaxDisallowance of written off as bad debts under section 36(1)(vii) - AO had denied the claim on the ground that the debt had not become bad and also that the assessee was otherwise dealing with the said concern - Held that:- The assessee has placed copy of the ledger account of the said party in its books at page 6 of the Paper Book. The Assessing Officer had denied the claim on the ground that the debt had not become bad and also that the assessee was otherwise dealing with the said concern. The learned Departmental Representative for the Revenue during the course of hearing pointed out that write off was premature as sum of ₹ 1 lakh was received by the assessee in the next year. The assessee had written part of the specific bill which was due from M/s. Goodwill Engineering Services. The assessee was otherwise engaged in the business of manufacturing, hiring and trading activities and had only sold one machinery to M/s. Goodwill Engineering Services on 30.11.2005 i.e. during the preceding year. However, the payment against the said machinery could not be realized by the assessee in full and only sum of ₹ 1 lakh after negotiations was paid by the said concern that too in assessment year 2008-09. At the close of the year, the assessee had written off of ₹ 68,750/- i.e. amount in question by treating it as irrecoverable and such act of write off of irrecoverable amount cannot be faulted with and the claim of assessee against writing off of such amount is to be allowed as deduction under section 36(1)(vii) of the Act. See Nichrom India Limited case [2016 (3) TMI 317 - ITAT PUNE ] - Decided in favour of assessee Disallowance made under section 14A - Held that:- The assessee has filed on record the copy of Balance Sheet as on 31.03.2007, in which the said investment is reflected at ₹ 2,80,000/- and even as on 31.03.2006, the investment was ₹ 2,80,000/-. Admittedly, the aforesaid investment has not been made in instant assessment year and is brought forward from the preceding year. In the earlier years, no disallowance under section 14A of the Act was made in the hands of assessee. The assessee admittedly, has not received any income on the said investment which is exempt from tax. The year under appeal before us is assessment year 2007- 08 and the provisions of Rule 8D of the Income Tax Rules, 1962 were not on Statute in the said assessment year. In view thereof, we find no merit in the aforesaid disallowance made under section 14A of the Act - Decided in favour of assessee
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