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2015 (7) TMI 991 - ITAT AHMEDABAD

2015 (7) TMI 991 - ITAT AHMEDABAD - TMI - Remission of unsecured loans - Whether could not be subjected to tax by invoking section 28(iv) of the Act - CIT(A) deleting the addition made by the AO as income u/s.2(24) r.w.s. 28(iv) - Held that:- Similar issue in case of CIT(A) V/s. Jindal Equipments Leasing & Consultancy services Ltd. (2009 (12) TMI 364 - DELHI HIGH COURT) wherein it has been held that waiver / write off principal amount of loan is not taxable as benefit or perquisites u/s.28(iv) b .....

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our of assessee. - ITA. No.845/Ahd/2011,ITA. No.846/Ahd/2011,ITA. No.847/Ahd/2011 - Dated:- 27-7-2015 - Shri Shailendra Kumar Yadav and Shri Anil Chaturvedi, JJ. For the Petitioner : Shri Dinesh Singh, Sr. D.R. For the Respondent : Shri A. C. Shah, A.R. ORDER PER SHAILENDRA KUMAR YADAV, J.M: These three appeals filed by Revenue pertain to different assessees are arising out form the orders of CIT(A)-XIV, Ahmedabad, dated 22.12.2010 for all three assessment years on similar issue. So, they are be .....

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ought to have upheld the order of the Assessing Officer to the extent mentioned above, since the assessee has failed to disclose his true income. 2.1 Assessing Officer made addition of ₹ 10,00,000/- being amount written off since not payable on the ground that same was trading receipt in as much as it is a capital receipt and that no deduction was allowed, which was deleted by CIT(A). Same has been opposed on behalf of Revenue inter alia submitting that CIT(A) erred in law and on facts in .....

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for A.Y. 2006-07, dated 28.09.2010, which has been followed by CIT(A) while granting relief to assessee. 2.2 Assessee carries on business in shares and securities. Assessee took a loan of ₹ 10,00,000/- from M/s. Rajkamal Enterprise on 10th November, 2000 for the purpose of business. Assessee provided interest of ₹ 1,72,640/- upto 31st March, 2002 and was claimed as deduction. Subsequently, the party was not traceable and therefore the principal amount of ₹ 10,00,000/- was writt .....

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on sharafi business. The observation of Assessing Officer in assessment order is only a casual observation without adducing any evidence. Sharafi business means the assessee accepts the deposits from public and lends to public. In present case, assessee has not accepted any deposit from public and has not lent through public. Certain deposits are accepted from relatives and they are utilized for the purpose of carrying on business for shares and securities. Therefore, it was found that assessee .....

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ded in favour of assessee by observing as under: 5.5 The counsel for the appellant has drawn my attention to the recent decision of Hon ble Delhi High Court in the case of CIT(A) V/s. Jindal Equipments Leasing & Consultancy services Ltd. 37 DTR 172(Del) wherein it has been held that waiver / write off principal amount of loan is not taxable as benefit or perquisites u/s.28(iv) because the benefits or perquisites should be of the nature other than cash. This decision has followed the cases of .....

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t case is about the taxability of written back amount of loan. Ld. CIT(A) while granting relief to the Assessee has given a finding that the Assessee was not carrying on the business of obtaining loans and therefore the remission of loan cannot be considered to be a benefit arising out from the business. We find that ld. CIT(A) while deciding the issue in favour of the Assessee had relied on the decisions cited therein and also the decision of Hon ble Gujarat High Court in the case of CIT vs. Ch .....

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er holding that remission of unsecured loans could not be subjected to tax by invoking Section 28(iv) of the Act. Same is upheld. 4. In ITA No. 846/Ahd/2011, Revenue has filed the appeal on the following grounds: 1) The Ld. CIT(A) erred in law and on the facts in deleting the addition of ₹ 10,00,000/- made by the AO as income u/s.2(24) r.w.s. 28(iv) of the IT Act, holding that remission of unsecured loans could not be subjected to tax by invoking section 28(iv) of the Act. On the facts and .....

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