TMI Blog2020 (5) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... in law - Regarding this technical objection, we find that an Explanation had been inserted in section 132 by the Finance Act, 2017 w.r.e.f. 01.04.1962 to the effect that the reasons to believe recorded by the income tax authorities under this section shall not be disclosed to any person or any authority or the Appellate Tribunal. The assessee also has not produced any material in support of this ground and therefore, we do not find any reason to interfere in the order of CIT (A) on this issue. Income reported on presumptive basis u/s 44AE by assessee - compute cash available with the assessee towards explanation of source of various investment - whether depreciation should be added because the income declared by the assessee is afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is argument by holding that addition has to be made because source of such advances could not be explained by the assessee and regarding claim of it as business loss, no specific finding is given and this claim was rejected by saying that bad debts are allowable u/s 36 (1) (vii) on actual write off - HELD THAT:- We feel that these findings of Chandrahas learned CIT (A) are also not sustainable because if the advances are given by the present assessee, its non recovery can be claimed as business loss by the present assessee only and it should be allowed if other pre requirements for claiming such loss is satisfied by the assessee. Actual write off in books is required to claim bad debts but the assessee is claiming it as business loss and no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of learned CIT(A) Mangaluru dated 28.01.2010. 2. In this appeal, the assessee has raised several grounds and several additional Grounds. As per Adpditional Grounds No. 1, the assessee has raised this technical objection that since the search warrant is in joint names, the assessment should have been made as an AOP and therefore, the present assessment in individual capacity of the assessee is bad in law. As per Additional Grounds No. 2, the assessee has raised this objection that that the interest charged u/s 158 BFA (1) should be deleted. As per Additional Grounds No. 3, the assessee has raised this objection that that the levy of surcharge should be cancelled. Various original grounds are raised on technical issue and on merit. Groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is reason that as per section 292CC recently inserted in the Income Tax Act, 1961 w.e.f. 01.04.1976, even in case of joint warrant, assessment has to be separate in individual names. The second technical objection is as per Ground No. 8 and 9 that search itself is illegal and therefore, the consequent block assessment is bad in law. Regarding this technical objection, we find that an Explanation had been inserted in section 132 by the Finance Act, 2017 w.r.e.f. 01.04.1962 to the effect that the reasons to believe recorded by the income tax authorities under this section shall not be disclosed to any person or any authority or the Appellate Tribunal. The assessee also has not produced any material in support of this ground and therefore, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on profit and does not involve actual cash outgo and hence, depreciation being a notional charge cannot become source of real asset like cash and gold. In our considered opinion, this logic of CIT (A) is not proper. If the income declared by the assessee u/s 44AE only is considered as source of cash and gold found then the amount of depreciation allowable should be added to such accepted source because such income declared u/s 44AE is after reducing allowable depreciation from real cash income and therefore to work out the cash available with the assessee on account of such income should be such income and the amount of allowable depreciation. But there is no finding of AO or CIT (A) about the amount of depreciation allowable on these four ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re given by the present assessee, its non recovery can be claimed as business loss by the present assessee only and it should be allowed if other pre requirements for claiming such loss is satisfied by the assessee. Actual write off in books is required to claim bad debts but the assessee is claiming it as business loss and not as bad debt u/s 36 (1) (vii). Such claim as bad debt is neither claimable nor allowable for this reason alone that the requirements of section 36 (2) cannot be satisfied for nonrecovery of trade advances. Hence, we will it proper to remand this matter also to the AO for a fresh decision about the claim of the assessee as business loss. We order accordingly and direct the AO to decide this issue by a speaking and reas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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