9911796707
|
Home
Issues involved: Appeal against order allowing bad debts deduction u/s 36(viia) and direction to examine claim u/s 10(34) for dividend income exemption.
Bad debts deduction u/s 36(viia): The appellant contested the allowance of bad debts amounting to Rs. 2,84,42,000 under section 36(viia) for assessment year 2007-08. The appellant, a cooperative society engaged in banking, had made a provision for bad debts but the Assessing Officer disallowed the claim stating the amount should have been written off. The CIT (A) allowed the claim, emphasizing that section 36(viia) does not mandate actual write-off in books, contrary to section 36(vii). The ITAT upheld the CIT (A)'s decision, noting that the clause does not require actual write-off by the assessee. Examination of claim u/s 10(34) for dividend income exemption: The appellant received dividend income of Rs. 20,03,000 but did not initially claim exemption u/s 10(34). Subsequently, during assessment, the exemption was sought. The Assessing Officer did not address this claim, leading to an appeal. The CIT (A) directed the AO to investigate the claim further, as the appellant had not provided sufficient evidence of tax payment by the distributing company. The ITAT supported the CIT (A)'s decision, stating that the CIT (A) did not exceed jurisdiction in directing verification of the tax payment on distributed profits, thereby upholding the exemption claim. Conclusion: The ITAT dismissed the revenue's appeal, affirming the allowance of bad debts deduction u/s 36(viia) and the direction to examine the claim for dividend income exemption u/s 10(34). The ITAT found no error in the CIT (A)'s orders and upheld the decisions in favor of the assessee.
|
