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2018 (10) TMI 1092 - ITAT MUMBAIDisallowance of depreciation - whether the assessee has put the asset to use for the purpose of its business? - Held that:- It is the claim of the assessee that it has generated revenue in the impugned as well as subsequent assessment years by using the said asset. In our view, the claim of the assessee that it has generated revenue by using the asset for the purpose of its business needs to be examined and the assessee deserves an opportunity to demonstrate such fact through proper documentary evidence. In view of the aforesaid, we are inclined to restore the issue to the file of the Assessing Officer for denovo adjudication after due opportunity of being heard to the assessee. This ground is allowed for statistical purposes. Disallowance of bad debt - reasoning on which the Assessing Officer has rejected the claim of bad debt is, it is in the nature of provision - Held that:- It appears from the impugned order of the learned Commissioner (Appeals) that the assessee created the entry for reducing the bad debt from the account of the debtor on 30th September 2007 i.e., after closure of the financial year relevant to the impugned assessment year. Further, it requires verification whether the claim was allowed on actual write off. In view of the aforesaid, we restore the issue to the Assessing Officer to examine whether the assessee has passed accounting entries with regard to the provision for bad debt in terms of the ratio laid down in M/S SOUTHERN TECHNOLOGIES LTD. VERSUS JOINT COMMNR. OF INCOME TAX, COIMBATORE [2010 (1) TMI 5 - SUPREME COURT OF INDIA]. Penalty proceedings u/s 271(1)(c) - Held that:- The additions on the basis of which the penalty under section 271(1)(c) of the Act was imposed by the Assessing Officer in assessment year 2007–08 has been restored back to him for denovo adjudication while deciding assessee’s appeal. Therefore, in absence of such additions, penalty under section 271(1)(c) of the Act will have no leg to stand.
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