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2014 (8) TMI 34 - ANDHRA PRADESH HIGH COURTPenalty u/s 271 – Benefit of deduction – Debts owed by various persons or agencies - Applicability of section 41(1) - It is only when an amount, which is already allowed or deducted, that can constitute the subject matter of Section 41 (1) of the Act, cannot be rejected as irrelevant - It is a different matter that the amount was brought under the assessment - as long as there is possibility to understand the provision in different ways and the Assessee has chosen one, the occasion to invoke Section 271 of the Act does not arise – Relying upon Commissioner of Income Tax Vs. Delhi Automobiles [2004 (5) TMI 16 - DELHI High Court] - If the debts were written off by the assessee itself, the situation is substantially different - It is only when those circumstances exist, that the occasion to take the amount from the purview of Section 41 of the Act, may arise - The issue is as to whether the assessee was under obligation to reflect the amount written off as an item of income - a unilateral act on its part did not have the effect of writing off, of the amount, it ought to have been reflected in the tax – the order of the Tribunal is upheld – Decided against Revenue.
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