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2021 (6) TMI 361 - AT - Income TaxAddition towards advertisement and publicity expenses on account of being relating to prior period - HELD THAT:- We observe that both the authorities below have confused the expenses to be on account of repair and maintenance whereas as a matter of fact these expenses were incurred on account of advertisement and publicity. We find merit in the contentions of the assessee that since the bills pertaining to these expenses were received during the year though these bills related to the earlier year, therefore these expenses have to be allowed as pertaining to the current year as the crystalisation has happened during the year. Without prejudice, the assessee has submitted that the year of allowability of expenses should be of no consequences so long as the rate of tax for both the years is uniform. The assessee has placed reliance on the decision of CIT vs. Nagri Mills Co. Ltd. [1957 (9) TMI 30 - BOMBAY HIGH COURT ] and also 3 other decisions. We have perused the decisions and found that the case of the assessee is squarely covered by the ratio laid down in the said decisions. We also find that the addition made by the AO is tax neutral. Accordingly, we set aside the order of Ld. CIT(A) and direct the AO to delete the disallowance Deduction for provisions for bad and doubtful debts on the ground that claim by the assessee was an afterthought - HELD THAT:- We find that the issue raised by the assessee is squarely covered by the decision of the Apex Court in the case of Vijay Bank [2010 (4) TMI 46 - SUPREME COURT] wherein as held that for the purpose of claiming the deduction under section 36(1)(vii) of the Act it is sufficient to debit the profit & loss account and correspondingly reduce the amount from sundry debtors and it is not necessary to close the individual account of all debtors in the books. Accordingly, we set aside the order of Ld. CIT(A) and direct the AO to allow the deduction. Ground No.2 is allowed. Addition bad and doubtful debts and provisions for the doubtful advances to the book profit computed under section 115JB by treating it as provisions for unascertained liability within the meaning of clause ‘c’ of explanation to 115JB - HELD THAT:- As we have already decided the issue of provision of bad and doubtful debts in favour of the assessee in ground No.2 directing the AO to allow the same. This grounds is consequential ground and accordingly we are inclined to hold that assessee is entitled to deduction of provisions for bad and doubtful debts and provision for advances while computing book profits. Accordingly, the ground is allowed. Deduction u/s 35ABB - HELD THAT:- Respectfully following the decision of the co-ordinate bench of the Tribunal, we direct the AO to determine the eligible amount in this year also following the decision in A.Y. 2004-05 and allow the same. The ground is allowed for statistical purposes. Addition of loss on account of foreign currency - HELD THAT:- As observe that Ld. CIT(A) has allowed the appeal of the assessee by following the decision of the Apex Court in the case of CIT vs. Woodward Governor [2009 (4) TMI 4 - SUPREME COURT] wherein it has been held that loss resulting from fluctuation in foreign currency is revenue loss as the same is recognised on the basis of accounting policy at the end of each year in respect of outstanding contracts of the assessee. We note that Ld. CIT(A) has allowed the appeal of the assessee following the decision of the Apex Court in the case of CIT vs. Woodward Governor (supra). We therefore find no reason to interfere with the order of Ld. CIT(A). Accordingly, we uphold the order of Ld. CIT(A) by dismissing the ground raised by the Revenue.
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