1977 (2) TMI 38
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....wn at shown at much higher figure. He observed that the amount debited to the profit and loss account as Dalali included expenses relating to earlier years also and the to total amount paid during the year was Rs. 6,705. The Income Tax Officer disallowed Rs. 5,000 on this account. The assessee had also claimed certain bad debts. A list regarding the bad debts had been furnished. The Income Tax Officer observed that no evidence had been produced regarding the steps taken for the recovery of the debts or to show that they had become irrecoverable. He also observed that some of them had become time-barred earlier. He, therefore, disallowed a sum of Rs. 22,652. He also observed that no deduction could be allowed for bad debts as had been writte....
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....on of the disallowance of Rs. 5,000 by way of dalali and the restriction of the disallowance under the head bad debts to the sum of Rs. 10,560. 4. On behalf of the appellant, Shri Gupte contended that the Appellate Assistant Commissioner had overlooked that a part of the dalali related to previous years and therefore deserved to be disallowed. In regard to bad deets he submitted that the Appellate Assistant Commissioner had merely recorded the assessee's submissions and had not gone into material available in regard to each of the debts specifically. He contended that the assessee had not placed any material in support of the claim of bad debts and that therefore, the Appellate Assistant Commissioner order should not be sustained. 5. Afte....
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....ven in respect of certain sales were effected in earlier assessment year, there is no reason why it should be disallowed. The question is not when the sales were effected but when the liability to pay Dalali accrued. In regard to that the assessee's contention has been accepted by the Appellate Assistant Commissioner and the Departmental representative is not in a position to place any material to the contrary. We are, therefore, unable to sustain the disallowance of Rs. 5,000 made by the Income Tax Officer. 6. Coming to the question of bad debts, again we are of opinion that the Appellate Assistant Commissioner's order was based on the material placed before him. A list of the bad debts totalling to Rs. 22,652 has been placed before us. T....
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.... debts had become bad. There is no reason to doubt the statements made by assessee. Nor do we find that the Income Tax Officer took any steps to make enquiries and to verify at least whether theDelhiparties mentioned by the assessee had closed down the business as stated. Normally in a case of this nature, we might have been inclined to send the case back to the Appellate Assistant Commissioner or the Income Tax Officer for looking into the facts pertaining to some of these debts at great length but in the present case we think that the Appellate Assistant Commissioner was justified in coming to the conclusion which he did, for one important reason. As we have mentioned already the assessee had filled a return declaring a loss of Rs.47,480 ....