Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2016 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (9) TMI 863 - HC - Income TaxAddition on account of disallowance of quality claim expenses - failure to furnish evidence - ITAT allowed the claim - Held that:- Commissioner as well as the Tribunal concurrently held that there was sufficient evidence on record to establish that the assessee had, in fact, suffered a loss of ₹ 2.90 crores on account of quality claim. The assessee pointed out that some of the exports suffered from total rejection or objection of inferior quality. Instead of re-importing such goods and selling in India which would be economically unviable, the assessee sold it to traders in the country of export for which the assessee was forced to give huge discounts. The purchasers had raised debit note, and thus charged such discounts to the assessee. This was thus, neither a case of unascertained nor a case of contingent liability. Merely because the assessee in the accounts, mentioned as a provision would not be conclusive of a nature of claim. This is precisely what the Commissioner held and observed. In fact, the assessee had charged such sum to the profit and loss account thereby deducting the expenditure for all practical purpose. In the present case the liability was not only certain, it was also discharged presently and not differed for a later date. The assessee had received debit notes from the buyers and accepting such liability, had debited a sum of ₹ 2.90 crores in the P & L account. - Decided against revenue
|