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2015 (11) TMI 270 - AT - Income TaxDisallowance of claim for deduction of bonus paid - Held that - There is no bar to entertain new claim either by Commissioner of Income Tax (Appeals) or Income Tax Appellate Tribunal . Accordingly, we direct the Assessing Officer to allow this claim after due verification, whether the bonus has been paid during the previous year under consideration, and whether the interest claim of ₹ 2,55,233/- is tax free or not. Accordingly, this ground of appeal is set aside to the file of the Assessing Officer to allow the claim, in the aforesaid terms. Commissioner of Income Tax Versus Mitesh Impex 2014 (4) TMI 484 - GUJARAT HIGH COURT Disallowance of deduction on account of bad debts - Held that - In the case in hand, the Assessing Officer denied the deductions under Section 36(1)(vii) solely on the ground that the bad debts which were written off were pertaining to the period when the income was exempt under the provisions of Section 80P of the Act and also on the ground that the deduction claimed under Section 36(1)(viia) is more than the deduction claimed under Section 36(1)(vii) of the Act. The reasoning of the Assessing Officer does not stand test of the law laid down by the Hon ble Apex Court in the case of Catholic Syrian Bank Ltd. (2012 (2) TMI 262 - SUPREME COURT OF INDIA). Further, it is not in dispute that the amounts claimed as bad debts were actually written off in the books of account and in the light of the fact that the provisions for bad debts was not claimed in the earlier years which goes to prove that the claim is not hit by the proviso to Section 36(1)(vii) of the Act. Therefore, we direct the Assessing Officer to allow the bad debts claimed. Accordingly, this ground of appeal is allowed. Addition on account of alleged difference between the interest income declared by the appellant and the Form No. 26AS of the Department - Held that - The information contained in Form No. 26AS cannot be itself the basis for making addition to the income returned. To the same effect, the decision of a coordinate bench of ITAT, Jabalpur, in the case of Ravindra Pratap Thareja Vs. ITO 2015 (10) TMI 1487 - ITAT JABALPUR . Accordingly, the grounds of appeal is set aside to the file of the Assessing Officer for due verification after affording reasonable opportunity of being heard to the assessee. Hence, the appeal is partly allowed for statistical purposes.
Issues Involved:
1. Legality of the CIT(A)'s order under Section 250(6) of the Income Tax Act, 1961. 2. Disallowance of deduction under Section 43B and tax-free interest. 3. Disallowance of deduction for bad debts written off. 4. Addition due to the difference in interest income as per Form No. 26AS. Detailed Analysis: 1. Legality of the CIT(A)'s order under Section 250(6): - The appellant contended that the orders passed by the CIT(A) for the assessment years 2009-10 and 2008-09 were "bad in law and against the facts of the case." However, this ground was considered general in nature and did not require specific adjudication. 2. Disallowance of deduction under Section 43B and tax-free interest: - The appellant claimed deductions of Rs. 19,49,792/- for bonus paid to employees and Rs. 2,55,233/- for tax-free interest. The Assessing Officer disallowed these claims because they were made through a revised computation of income instead of a revised return of income. - The appellant argued that the bonus amount was disallowed in the previous year and paid in the current year, and the tax-free interest was mistakenly offered to tax. - The Tribunal noted that the Hon'ble Supreme Court in Goetz India Ltd. Vs. CIT (284 ITR 323) restricted the power of the Assessing Officer to entertain claims without a revised return but did not limit the powers of appellate authorities. The Tribunal cited various High Court rulings, including CIT Vs. Mitesh Impex (225 Taxman 168), which supported the view that new claims could be made at any stage of appellate proceedings. - Consequently, the Tribunal directed the Assessing Officer to verify and allow the claims if the bonus was indeed paid during the relevant year and the interest was tax-free. 3. Disallowance of deduction for bad debts written off: - The Assessing Officer disallowed the bad debts of Rs. 20,24,842/- on the grounds that the appellant had already claimed a deduction under Section 36(1)(viia) and that the bad debts pertained to a period when the appellant claimed deduction under Section 80P. - The Tribunal referred to the Hon'ble Supreme Court's decision in Catholic Syrian Bank Ltd. Vs. CIT (343 ITR 270), which clarified that Sections 36(1)(vii) and 36(1)(viia) are distinct and independent. The Tribunal held that the bad debts written off should be allowed as a deduction, provided they meet the conditions under Section 36(2). - The Tribunal directed the Assessing Officer to allow the bad debts claim of Rs. 20,24,842/-. 4. Addition due to the difference in interest income as per Form No. 26AS: - The Assessing Officer added Rs. 7,03,654/- to the appellant's income based on a discrepancy between the interest income reported by the appellant and the information in Form No. 26AS. - The Tribunal cited previous ITAT decisions, including ITA No. 4679/Del/2012 and Ravindra Pratap Thareja Vs. ITO (154 ITD 633), which held that Form No. 26AS alone cannot be the basis for such additions. - The Tribunal remanded the issue back to the Assessing Officer for verification, directing that reasonable opportunity be given to the appellant. Conclusion: - For AY 2009-10 (ITA No. 840/Del/2013), the appeal was partly allowed for statistical purposes, with directions for the Assessing Officer to verify and allow the claims as discussed. - For AY 2008-09 (ITA No. 1432/Del/2012), the appeal was allowed in full, directing the Assessing Officer to allow the bad debts deduction of Rs. 23,00,268/-. Pronouncement: - The decision was pronounced in the open court on 16.10.2015.
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