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2019 (6) TMI 1225 - HC - Income TaxAllowability of bad debts written off u/s 36(1)(vii) - Exclusion of the amount received as recovery of bad debts written off - taxability u/s 41(4) - in the earlier years deduction had not been allowed in respect of write off of such bad debts u/s 36(1)(vii) - Income earned from a foreign branch - whether could not be assessed in India in view of the tax treaty between India and the respective Country? - HELD THAT:- Perusal of the impugned judgment of the Tribunal would show that the Tribunal had merely sent the issues back to the Assessing Officer for proper examination on the additional grounds raised by the assessee before the Tribunal. We are informed that the Assessing Officer has already given effect to such directions of the Tribunal and passed appropriate order, which of course has given rise to further dispute between the assessee and the department. Be that as it may, in facts of the case, we do not think that the Tribunal’s decision gives rise to any substantial question of law. Depreciation on matured investments securities which were due for redemption in the relevant previous year - NPA - real income theory -Tribunal disallowed the Appellant’s claim for deduction - HELD THAT:- Tribunal has approved the observations of the CIT(A) that the real income theory cannot be so extended so as to negate accrual of an amount which is receivable by the appellant assessee. In support, reliance is placed upon the decision of this Court in Navin R Kamani Vs. Commissioner of Income Tax [1990 (3) TMI 40 - BOMBAY HIGH COURT] . It also held that the concept of real income theory cannot be read so as to defeat the provisions of the Act. Further, the fall in value of security is not an ascertained liability and such adhoc deduction cannot be allowed. The impugned order places reliance upon the decisions of the Apex Court in Indian Molasis Company Pvt.Ltd. Vs. Commissioner of Income Tax, [1959 (5) TMI 5 - SUPREME COURT] and of this Court in Standard Mills Company Vs. Commissioner of Income Tax [1997 (3) TMI 64 - BOMBAY HIGH COURT] Impugned order of the Tribunal is based on various binding decisions of the Apex Court and this High Court not shown to be inapplicable. Thus, no substantial question of law arises.
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