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2017 (1) TMI 185 - AT - Income TaxDisallowance of the bad debts claim - business loss admissibility - Held that:- In the present case, the amount ₹ 2,93,611/- paid by the assessee in excess of agreed consideration to discharge the liability of vendor of capital asset has not been received back by the assessee. Ostensibly, the said amount has become irrecoverable, therefore, the same is allowable as business loss under the provisions of section 28 of the Act. The amount paid by assessee to discharge the liability of vendor that has been adjusted against sale consideration partakes the character of capital expenditure. Thus in view of the facts we are of the considered opinion that although the amount of ₹ 2,93,611/- excess paid by the assessee cannot be allowed to write off as bad debt however, the said amount can be considered as business loss u/s 28 of the Act. - Decided partly in favour of assessee Disallowance of interest on loan and pre-payment charges - Held that:- A.R. could not place any other document to show that the building was complete in every respect and was ready to use during the period relevant to the assessment year under appeal. The only document i.e., building completion certificate on which the Ld. A.R. has placed heavy reliance could not support the case of assessee. The matter has travelled three stages. The assessee could not obtain the rectified or the correct building completion certificate either at the time of assessment or at the time of first appeal proceedings. Even during the second appeal stage, the assessee has filed the same document. There is no other document on record to substantiate the claim of assessee. Thus, we are of considered view that the building was not ready during the period under consideration. Under such circumstances, the interest paid and pre-payment charges paid by the assessee cannot be allowed as revenue expenditure. We do not find any infirmity in the order of ld. CIT(A) in rejecting the claim of the assessee and to treat the expenditure as revenue in nature - Decided against assessee
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