GST Helpdesk   Subscription   Demo   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
What's New Case Laws Highlights Articles News Forum Short Notes Statutory TMI SMS More ...
Extracts
Home List
← Previous Next →

2016 (2) TMI 734 - ITAT DELHI

2016 (2) TMI 734 - ITAT DELHI - TMI - Addition on account of bad debt - CIT(A) deleted the addition - Held that:- In this case their lordship referred to the Circular no. 551 dated 23.01.1990 of the CBDT and held that the amendment made to Section 36(1)(vii) of the act was a decision taken to eliminate litigation with regard to establishing their lordship what is bad debt further observed if the assessee writes off a debt as to bad debt without giving any reason he will not get any benefit from .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

a bad debt. In the present case, the assessee submitted party-wise detail, copies of the invoices/ bills raised against the debtors and other relevant documentary evidence to prove that the amounts was incorporated as revenue receipts and offered as income in the earlier financial year. The assessee also submitted copies of the e-mails and other correspondence with the debtors showing that the conscious and sincere efforts made by the assessee company towards recovery of impugned amounts and the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ntion of the assessee to treat the amounts of debts as bad debts. Thus, the issues is squarely covered in favour of the assessee by the ratio laid down by Hon’ble Apex Court in the case of TRF Ltd. v. CIT [2010 (2) TMI 211 - SUPREME COURT] and hence we hold that the CIT(A) rightly granted to relief to the assessee. We are unable to see any valid reason to interfere with the impugned order and thus we confirm the same. - Decided against revenue - ITA No. 4130/Del./2010 - Dated:- 18-1-2016 - Sri R .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ing the addition of ₹ 6,52,13,606/- made by the AO on account of bad debt. 2. Apropos sole ground of the revenue, we have heard arguments of both sides and carefully perused the relevant material placed on record before us, inter alia, assessment order, impugned order of the CIT(A) and other documents placed on record before us. The ld. Departmental Representative (DR) supporting action of the AO drawn our attention towards relevant paragraph 2 to 2.5 and submitted that the assessee could .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ove that the amount sought to be written off was offered as revenue and income theirfrom was offered to tax during the relevant earlier financial period. The ld. DR, further, drawn our attention towards relevant paragraph 4.7 of the impugned order and submitted that the CIT(A) granted relief to the assessee without any justified reason and basis, therefore, impugned order may be set aside by restoring that of the AO. 3. On the above contentions and submissions of the revenue, the Ld. Assessee s .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bmitted that amount claim under the head Rebate & Discount is on account of cash discount, quantity discount in respect of sales made during the relevant financial period to various parties and in no way connected with the amount which is gone bad on account of reasons initiated in respect of sales made in the previous year as well as in the current year. The Ld. AR, further pointed out that in order to prove genuineness of the bad debts, the assessee company filed the copies of the EMails e .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s dated 10.6.2010 placed before the first appellate authority and submitted that in the para 2.4 the AO observe that in order to claim deduction on account of bad debts it was still to be established that debts has become bad and at the same time it should also be written off in the books of accounts. The Ld. AR in this regard submitted that the AO misconstrued provisions of the law as its stand today which state that as per section 36(i)(vii) with effect from 01.04.89, the claim for bad debts w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tten off during the financial year relevant to the assessment year under consideration. 5. On carefully considered on above rival submissions from the first appellate order, we observe that the CIT(A) granted relief to the assessee with following observations and conclusion -: 4.7 The submissions of the appellant, the assessment order, and the facts and circumstances of the case have been carefully considered. It has been observed that in the assessment order the Ld. A.O. has pointed out that th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

pellant proceedings, it has been stated that the appellant filed complete details of rebate and discount and misc. expenses and the perusal of the same showed that the expenses claimed under those heads are totally different and relate to the assessment year in question. The AO has also stated that the appellant company also filed the copies of the emails exchange between it and its debtors alongwith details showing the amount of debt which they are not able to recover from their debtors. They a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rties, its claim of bad debts in the year under review is not qualified. It has been stated that the record produced showed that the amount which has gone bad relates to the different sales made during the previous year(s). Further, it is argued that regular dealing with the parties does not debar the appellant to claim the amount which has gone bad in respect of earlier sales. It has been stated that Section 36(1)(vii), as it stands with effect from 1-4-1989, reads as follows :- 36. Other deduc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bt, or part thereof, which is established to have become a bad debt in the previous year. The appellant has argued that there is significance difference between the provisions as it stood prior to 01.04.1989, and the provisions stands today. Prior to 01.04.1989, it was necessary for the assessee to establish that the debt had become bad, whereas now for the debt to be classified as bad, the assessee has only to write it off as irrecoverable in its accounts. The appellant relied on the position o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

at Prasad (2002) 256 ITR 772,774 (Guj.) A.W. Figgis & Company Pvt. Ltd. v. CIT (2002) 254 ITR 63, 65-66 (Cal.) While going through the judgments of the Hon ble Supreme Court, Hon ble Delhi High Court and the various other court and also the provision of the law its stands today and also going through the material on record, I am left with no option but to allow the appellant s contention of bad debts and allow the claim of bad debts amounting to a sum of ₹ 6,52,13,606/- and delete the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nd discount and miscellaneous expenses which showed that the expenses claim under those heads are totally different and pertaining to the assessment year under consideration in this appeal i.e. 2004-05. These fact has not been controverted by the ld. DR during the arguments before us. The Ld. CIT(A) also noted that the AO also observe that the assessee company has also filed the copies of the email exchange between it and its debtors alongwith details showing the amount of that which the assesse .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

xmann.com 106 (S.C.) (Supra) and other relevant judgments of Hon ble Jurisdictional High Court of Delhi including recent judgement in the case of CIT vs. Autometers Ltd. (2008) 167 Taxman 286 (Delhi) (Supra). We are inclined to hold that the interpretation of Section 36(1)(vii) of the Act was considered by Hon ble High Court of Delhi in the case of CIT vs. Morgan Securities and Credits Pvt. Ltd. (2007) 162 Taxman 124 (Del.) (Supra) and in this case their lordship referred to the Circular no. 551 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Latest Notifications:

    Dated      Category

20-7-2017 Cus (NT)

18-7-2017 IT

18-7-2017 CE (NT)

18-7-2017 CE

18-7-2017 GST CESS Rate

15-7-2017 Kerala SGST

14-7-2017 Andhra Pradesh SGST

14-7-2017 Cus (NT)

14-7-2017 Cus

13-7-2017 Co. Law

13-7-2017 Co. Law

13-7-2017 ADD

13-7-2017 ADD

12-7-2017 Jammu & Kashmir SGST

12-7-2017 Gujarat SGST

12-7-2017 Gujarat SGST

12-7-2017 CGST Rate

12-7-2017 UTGST Rate

12-7-2017 UTGST Rate

12-7-2017 IGST Rate

More Notifications


Latest Circulars:

19-7-2017 Income Tax

18-7-2017 Customs

17-7-2017 Customs

14-7-2017 Income Tax

13-7-2017 Central Excise

13-7-2017 Customs

13-7-2017 Central Excise

13-7-2017 Customs

7-7-2017 Income Tax

7-7-2017 Goods and Services Tax

More Circulars



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version