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2009 (8) TMI 54 - HC - Income TaxBad Debts u/s 36(1)(vii) - ‘Bad Debts” written off included incomes not received – Application of provisions of Section 14A - The assessee is engaged in manufacturing and export of engineering goods. The Assessing Officer disallowed claim for bad debts under Section 36(1)(vii) on the ground that the assessee had claimed deductions under Section 80HHC and in such a situation claim for bad debts will be hit by Section 14A of the Act. The CIT(A) partly upheld the claim of the assessee – ITAT upheld the order of CIT(A) – Held that - On perusal of Section 80HHC and Section 14A, it is clear that expenditure incurred from export income cannot be held to be for earning income which does not form part of total income, which concept is dealt with under Section 10 of the Act. Section 80HHC deals with deduction of the element of profit from export from taxable income – Deduction allowed.
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