TMI Blog2018 (12) TMI 1558X X X X Extracts X X X X X X X X Extracts X X X X ..... to produce confirmations from these seven sundry debtors either during the assessment proceedings or during the appellate proceedings. Hence we hold that the primary onus and the three ingredients of section 68 has not been discharged by the assessee in the instant case. - decided against assessee Claim of bad debts u/s 36(1)(vii) - alternative argument stating that in case if the said credit to the account of the sundry debtors are not believed to be genuine by the department, it cannot be disputed that the assessee had reduced the debtors’ account balances in its books of accounts which effectively amounts to write off of debts - Held that:- As relying on M/S. D.K. INDUSTRIES VERSUS I.T.O WARD 34 (3) , KOLKATA [2016 (5) TMI 850 - ITAT KOLKATA] we hold that the assessee in the instant case is entitled for deduction as bad debts based on alternative argument advanced by the ld. AR. Accordingly, grounds raised by the revenue are dismissed. - I.T.A No. 2190/Kol/2013 - - - Dated:- 12-12-2018 - Shri A T Varkey, JM, And Shri M.Balaganesh, AM For The Appellant : Shri Saurabh Kumar, Addl. CIT Sr. DR For The Respondent : Shri A.K. Tibrewal, FCA ORDER Per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resses of the debtors and has filed a statement showing particulars of account in their names during this year, recovery of amounts during the year and closing balance outstanding as on 31.03.2005 to 31.03.2009, profit and loss account for the same period, list of sundry debtors, confirmatory certificates and such other particulars to prove that these sums represent realization from debtors. Accordingly, it was pleaded that the provisions of section 68 per se are not at all applicable in the facts of the instant case as it pertains to trade receipts and not loan receipts or share capital receipts. The assessee also placed reliance on certain decisions in support of these contentions. The Ld. CIT(A) deleted the addition by observing as under: 12. All the grounds of appeal are directed against the addition of ₹ 1,89,34,232/- made by the A.O. I have given careful consideration to the contention of the appellant and have also perused the order of the A.O. and relevant documents. I find, there are sufficient force to the arguments placed by the Id. counsel for the appellant. Before dwelling upon the impugned issue related to addition of ₹ 1,89,34,232 it may be necessa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20,00,000 Arvind Trading Co. 2,50,000 Ritu Kejriwal 25,000 Expenses 9,045 1,91,27,045.00 Closing balance 95,989.80 13. The apparent state of affairs clearly indicate that the appellant sold goods on credit in earlier years and met liabilities in subsequent years out of sums collected from the sundry debtors. In my view the Assessing Officer acted upon mere assumption that those sums credited to the accounts were not genuine transactions. Mere suspicion cannot take the place of proof. Accordingly, the overall circumstances also do not suggest that any adverse inference should be drawn against the appellant. The same procedure was followed by the appellant in the previous year relevant to the asst. year 2006-07 and the realization of money from the sundry debtors was brought into controversy in the assessment. The dispute cropped up for the asst. year 2006-07 was resolved by the order of the Hon'ble Tribunal in the appeal in ITA No-371/Kol/2010 preferred by the appellant. The relevant obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ministration field. In CIT v. Ralson Industries Ltd. (288 ITR 322 SC) the Hon'ble Supreme Court observed that when an order is passed by a higher authority, the lower authority is bound thereby keeping in view the principles of judicial discipline. Therefore, I hold that the Assessing Officer should not deviate from the earlier decision of the Hon 'ble Tribunal in the case of the appellant for application of the same view in this year. 15. Having considered the contention of the appellant, the relevant facts, material on record and citation relied upon I am of opinion that the addition is not sustainable in law. I find that the issue is squarely covered in favour of the appellant vide order dated 9.11. 2012 of the jurisdictional Tribunal in ITA No- 371/Kol/2010 in the appellant's own case for the A.Y.2006-07. Respectfully following the aforesaid order of the Honourable Tribunal in the appellant's own case, the addition of ₹ 1,89,34,232/ - made by the Assessing officer is deleted. Aggrieved the revenue is in appeal before us. 5. We have heard the rival submissions. At the outset, we find that there were certain cash deposits made in the bank acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thored by the undersigned in the case of D.K. Industries vs. ITO in I.T.A. No. 683/Kol/2013 for assessment year 2009-10 dated 08.04.2016, wherein it was held as under: 6. We have heard the rival submissions and perused the materials available on record including the paper book filed by the assessee comprising of (i) copy of partnership deeds dated 1.4.1994, 1.4.2007 and 1.4.2008 vide pages 1 to 41 of paper book ; (ii) copy of IT return acknowledgement together with audited accounts for Asst Year 2009-10 vide pages 42 to 56 ; (iii) copy of assessment order u/s 143(3) of the Act dated 7.12.2010 for Asst Year 2008-09 vide pages 57 to 72 ; (iv) Copy of intimation u/s 143(1) of the Act dated 27.7.2001 for Asst Year 1999-2000 vide page 73 ; (v) copy of tax audit report together with audited accounts for Asst Year 1999-2000 vide pages 74 to 105 ; (vi) copy of IT return acknowledgement and assessment order us 143(3) of the Act for the Asst Year 1998-99 vide pages 106 to 113 and (vii) copy of audited balance sheet as on 31.3.1998 together with tax audit report vide pages 114 to 140 . 6.1. We find that the addition has been made the Learned AO on the ground that the assessee cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e various partnership deeds of the assessee vide clause 3 which are reproduced herein below for the sake of convenience :- 3. That the business of the firm shall be mainly that of export import of agro products like raw cotton, pulses, food grain, spices etc., ginning and pressing of cotton, commission agent, manufacturer s representative, general merchant, financier including money lending business, real estate and shall be entitled to carry on any other trade or business or manufacturing whatsoever as mutually agreed upon by the partners. The same clause is present in the original partnership deed dated 1.4.1994 vide clause 3 and also in reconstituted partnership deeds dated 1.4.2007 and 1.4.2008. This goes to prove that the assessee is indeed engaged in money lending business also. We also find that the assessee had duly shown the amounts receivable from the aforesaid three parties (i.e Raj Enterprsies, Brand Alloys Ltd and Vinay Kumar Baid) as loans and advances in the balance sheet as on 31.3.2008 (immediately preceding asst year) with the balances of ₹ 36,50,036/- in total of these three parties. This goes to prove that the assessee had continued its ..... X X X X Extracts X X X X X X X X Extracts X X X X
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