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2023 (10) TMI 43 - BOMBAY HIGH COURTTP adjustment - international transactions made on account of import of paper, aluminium foil, K Film, purchase return of imported paper, etc. - TPO made certain adjustments to the operating profit by excluding certain items of income from the scope of operating profit of the Assessee - TPO held that out of the operating profits of the Assessee as declared in the books of accounts, six items should not constitute the operating profits and hence were excluded - CIT (A) held against the Assessee on interest on Fixed Deposit income tax, refund and profit on sale of assets etc., the Assessee had preferred an Appeal and to the extent CIT(A) accepted the submissions of the Assessee, the Revenue had preferred an Appeal. HELD THAT:- As regard the credit to profit and loss account on account of liabilities written back, the details of the liabilities written back were made available to CIT(A) as well as ITAT. Both, on facts, and having considered those details, have come to conclusion accepting the Assessee’s contention that those liabilities belong to earlier years and are directly relatable to the regular business operations of the Assessee and since these liabilities were no longer payable to business creditors should be allowed to be written back in the Assessment Year under consideration and the same was rightly offered to tax as business income u/s 41(1) of the Act. Therefore, on facts it was accepted that these liabilities written back were arising out of normal business operations and hence form part of operating income of the Assessee. As regards the writing back of doubtful debts CIT(A) came to a factual finding which has also been accepted by the ITAT that those doubtful debts were inextricably linked with the business operations and hence should be considered as operating income. Therefore, there are factual findings to that effect and both CIT(A) and ITAT have accepted the details submitted by the Assessee. No substantial question of law arises.
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