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2019 (1) TMI 750 - AT - Income TaxDisallowance of loss foreseeable on project - Held that:- Assessee merely submitted that assessee has given treatment in the accounts as per Accounting Standard-7 issued by ICAI. Assessee was not able to rebut the findings of the DRP in this regard. It is not in dispute that the claim was made on mere estimate. It was also not disputed that the loss have not actually been crystallized during the assessment year under appeal. It is also not explained as to how the foreseeable loss have been calculated and what was the justification. It is well settled law that if assessee would have incurred actual loss, then the same would be allowed in the year when such loss have been incurred and crystallized. DRP has specifically noted that even the loss have not taken place in assessment year under appeal. These findings of the authorities below have not been rebutted by the assessee through any evidence or material on record. Therefore, mere making a claim on account of foreseeable loss on estimate is not an allowable deduction under the Act. We, therefore, confirm the findings of the authorities below and dismiss Ground of the appeal of assessee. Disallowance of relation to sundry balances written off during the year, even though the same is allowable under section 37(l) - Held that:- The draft order was sent to assessee-company. The assessee-company filed its objections before the DRP, but the Order of the A.O. was confirmed on the reasons that the amount is incurred on salary advance and other payments. Therefore, same are not in the nature of trading loss and also of bad debts. Tribunal restored the matter back to the file of DRP for considering the issue afresh. The DRP noted in their findings that amount have been incurred on salary advance and other payments which are neither in the nature of trading loss nor bad debts, therefore, Order of the A.O. was found correct. No merit in this ground of appeal of assessee. The assessee at the initial stage could not file any reply on this issue. The DRP has given a specific finding that this amount have been incurred on salary advance and other payments which are neither in the nature of trading loss nor the bad debts. Learned Counsel for the Assessee have not been able to point-out any infirmity in the findings of the DRP - decided against assessee.
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