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TMI Blog2013 (3) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... ts as covered by the provisions of Section 36(1)(vii) r.w.s. 36(2). The CIT (A) even after considering the legal principles in favour of the assessee confirmed the additions on the reason that the details were not furnished in support of the claims. 3. Before us the paper book containing pages 1 to 184 has been filed along with the fact sheet and the relevant case law. Learned Counsel referring to the paper book, which was filed before the Assessing Officer and the CIT (A) also, submitted that relevant information, account copies and other details were filed before the Revenue Authorities, but not considered by them. The learned Departmental Representative however, reiterated the findings of the Assessing Officer and the CIT (A). 4. We have considered the issue. There is no dispute with reference to the fact that the assessee has written off the above amounts. The issue is one of the factual examination that the conditions under section 36(2) have been satisfied ie. the amounts have been taken into consideration in earlier years so as to write off the amount as bad debt. It was submitted that the assessee is a private limited company engaged in the activity of undertaking turn-ke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is one of the contention that the amounts were receivable from assessee's sister concerns and also from customers. Since the issue was not examined by the Assessing Officer, we are of the opinion that the same can be remitted to the Assessing Officer for examination on facts. The Assessing Officer is directed to examine whether these amounts are taken into account in the earlier years or not and allow write off. Assessing Officer is also directed to examine whether the amounts receivable from the associate concerns which were claimed were in the course of business or otherwise. With these directions ,the issue of remission of the above amount contested in Ground No.1 to 4 are restored to the file of the Assessing Officer. B) Bad debts Rs.51,33,489/-. The amounts written off pertain to the following: Maharashtra Jeeven Pradhikaran Hingoli, Parbhani Rs.39,27,208 Municipal Corporation of Greater Mumbai Rs.12,06,281 It was submitted that these are the contract receipts due from above concerns for more than 10 years. In the case of Maharashtra Jeevan Pradhikaran, the contract started in financial year 1997-98 and as per the contract 85% of the procurement price was to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t examined by the Assessing Officer in the corrective perspective, we are of the view that the issue can be examined on factual basis and the amounts can be allowed to the assessee after giving an opportunity to the assessee. On principles of law, however, there is no scope for any disallowance as the amounts were written off. However, contention raised by the assessee with reference to the satisfying the conditions under section 36(2) are only to be examined. For this purpose the matter is restored to the file of the Assessing Officer. Ground Nos. 5 to 7 are accordingly allowed for statistical purposes. C) The next issue is advance write off of Rs.4,02,200/-. This amount was written off as advance from sister concern Perfect Engineering Associates, Aurangabad. It was submitted that the advances was sought for business purposes and the same may be allowed as business loss. It was fairly admitted that this amount cannot be considered under section 36(1)(vii) and has to be considered as business loss. There is no explanation about the nature of advances given except stating that this amount is shown as receivable for the last 8 years. Since Perfect Engineering Associates is a siste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies. Even though the learned Counsel relied on the decision of Coordinate Bench in the case of Franco-Indian Pharmaceuticals (P) Ltd vs. Income Tax Officer 3 ITR (Trib.) 754 Mumbai that the issue can be raised as additional ground before the ITAT, the same is not applicable as assessee raised it before CIT(A). It was the submission that the unsecured loans written off were never claimed in the Profit & Loss A/c as trading liability and any reduction in respect of loans not claimed as trading liabilities cannot be brought to tax under section 41(1) and relied on the decision of Hon'ble Bombay High Court judgment in the case of Mahindra & Mahindra vs. CIT 261 ITR 501 (Bom.) and Logitronics (P) Ltd vs. CIT 333 ITR 386. The learned Departmental Representative however, objected to as there was no details on the file and the claim cannot be allowed without necessary facts being on record. 6.2 We have considered the issue. The issue was raised before the CIT (A), considered by the CIT (A) and was rejected. This is not an additional ground before the ITAT. Therefore, many of the principles/propositions laid down do not apply as this issue arose out of the order of the CIT (A). The CIT (A) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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