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2017 (10) TMI 727 - AT - Income TaxExemption u/s 12AA denied - Income from micro finance and provision for doubtful debts - Held that:- Prior to adding proviso to section 2(15), the entities which got registration u/s. 12AA engaged in commercial activity claimed exemption on the ground that such activities were for advancement of objects of general public utility in terms of 4th limb of definition to section 2(15) of the Act. We find that the said benefit was taken away by adding proviso to section 2(15) of the Act, wherein it explains that the advancement of any other object, general pubic utility shall not be charitable purpose. In our opinion that the AO and the CIT-A opined that the assessee conducted its activities on commercial line in the nature of trade, commerce or business. Therefore, they rightly denied the exemption by following statutory provisions. We do not find any infirmity in the impugned order of the CIT-A. We find that the ratio laid down by the decisions as relied upon by the ld.AR are not applicable to the facts of this case. We uphold the same. This issue of the assessee is dismissed. Claim of provision for bad & doubtful debts - Held that:- We find that the assessee has shown other receipts of ₹ 70,49,240/- which includes provision for bad and doubtful debt of last year (Schedule 11 & 14) of ₹ 53,60,345/-. The assessee in its written submission stated that cost of recovery is very high and the possibility of bad debt is also high as the loans were advanced without any surety or guarantee. We find from the record that the assessee has shown a provision of bad and doubtful debt in the last year for a sum of ₹ 53,61,345/-, which is more than the amount in the year under consideration and the AO has already deducted the same while computing the income of the assessee for the year under consideration. The assessee, therefore, cannot be said to have any grievance of the assessee on this issue.
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