Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (2) TMI 1073 - ITAT DELHIDeduction on account of bad debts written off - Held that:- It is pertinent to mention that the admissibility of deduction u/s 36(1)(vii) is coupled with the fulfillment of the condition as given in section 36(2). The later provision provides that no such deduction shall be allowed unless such debt or part thereof has been taken into account in computing the income of the assessee of the previous year in which the amount of such debt or part thereof is written off or of an earlier previous year, etc. A conjoint reading of section 36(1)(vii) and section 36(2) makes it abundantly clear that any amount of bad debt written off during the year can be allowed as deduction provided such debt or part thereof was taken into account in computing the income of the assessee for this year or an earlier year. Unless such debt is taken into consideration in the computation of total income, there can be no question of allowing deduction on its becoming irrecoverable or on a mere write off. As necessary facts of this issue are not available and the ld. CIT(A) has simply accepted the assessee's claim without going into the deductibility of this amount as per law in terms of above discussion, we set aside the impugned order and remit the matter to the file of AO for deciding this issue afresh in conformity with our above observations. Needless to say, the assessee will extend full co-operation to the AO by submitting the details called for and will be entitled to a reasonable opportunity of being heard in such fresh proceedings. - Decided in favour of revenue for statistical purposes. Addition on account of provision for contractor and provision for suppliers - CIT(A) deleted the addition - Held that:- CIT(A) deleted the addition without going into the merits of its deductibility in the first instance. He simply mentioned in the impugned order that the assessee had shown that the provisional balances were specifically adjusted against the bills of sub-contractors. In contrast to that, we observe from the assessment order that the assessee did not furnish any details and anything about the otherwise deductibility of such provisions. Further, there is no elaborate discussion about these vital aspects in the impugned order. We, therefore, set aside the impugned order on this issue and remit the matter to the file of AO for a fresh determination of the same as per law, after allowing a reasonable opportunity of being heard to the assessee.- Decided in favour of revenue for statistical purposes.
|