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2016 (1) TMI 1128 - ITAT RAJKOT

2016 (1) TMI 1128 - ITAT RAJKOT - TMI - Addition on account of disallowance of quality claim expenses - CIT(A) deleted the addition - Held that:- It is not even in dispute that the quality claim were made. As for the Assessing Officer’s stand that in view of debit note sent by the buyer, the assessee should have reduced its sale and only shown the net figure of sales, we find that whether gross sales is shown on the credit side, with a quality claim shown on the debit side, or whether a net sale .....

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banking terminology such transactions of loan against receivables from foreign buyers are sometimes termed as FDBP (Foreign Documentary Bills Purchased), these are essentially nature of loans to exporters. Nothing, therefore, turns on the receipt of loans in respect of bills raised by the assessee. These are not revenue receipts at all, nor was it ever the case of even the Assessing Officer, on the light of these discussions, we approve the well reasoned of the CIT(A) and decline to interfere i .....

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sessing Officer is as follows :- 1. The CIT(A) has erred in law and on facts in deleting the addition of ₹ 2,90,20,000/- made by the Assessing Officer on account of disallowance of quality claim expenses. 3. Learned representatives fairly agree that whatever we decide on Assessing Officer s appeal for the assessment year 2008-09 in this assessee s case, which was heard along with this appeal, will equally apply for this appeal as well. All the material facts and circumstances are the same. .....

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nnot be said to be contingent or uncertain liabilities. Here is a case in which the claim is quantified but even in a situation the claim is not quantified but only reasonably estimated the deduction is admissible. As observed by Hon ble Supreme Court in the case of Bharat Earth Movers Ltd. Vs. CIT [(2000) 245 ITR 428 (SC)], The law is well settled; if a business liability has definitely arisen in the accounting year, the deduction should be allowed although the liability may have to quantified .....

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