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TMI Blog1978 (7) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... as per profit and loss account to the extent of Rs. 15,870 to tax. 4. The assessee appealed to the AAC. By this time the assessee appeals for the earlier years were decided by the Tribunal and a revision application to the Commissioner was also disposed of. Based on this, the AAC held that the assessee was a charitable trust and it is entitled to exemption, but directed the ITO to look into s. 11(2) of the Act for purposes of giving effect to his order. On receipt of this order, the ITO amended the assessment on 14th Feb., 1974 holding that the total income was nil and cancelled the demand originally raised. On 20th Dec., 1974 the ITO passed a rectificatory order, whereby he amended his earlier order dt. 14th Feb.,1974. He held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee is eligible to get the exemption. Regarding the second year also he allowed the claim of the assessee to bad debts of Rs. 4,779 and held that the assessee had applied income by the payment of Rs. 30,000 on 2nd Jan., 1973 and a further sum of Rs. 6,000 on 6th Jan., 1973. In this manner he allowed the appeals of the assessee. 7. The revenue has come in appeal. The Departmental Representative submitted that there was no provision under s. 11 for consideration of failure to apply the opinion prescribed and the AAC's order should not have granted the exemption. The AAC's order should therefore, be reversed. In the second year, it was also submitted that the AAC was in error in allowing the claim for deduction of bad debts. 8. Since the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rofit and loss appropriation account below the income and expenditure statement for the year ended 31st Dec., 1970 it is seen that only a sum of Rs. 219 was carried over to the balance sheet. In this background, the payment made on 2nd Jan.,1971 would entitle the assessee to claim relief. Alternatively if this sum cannot be taken as application of income for the year 1971-72, it can be taken as application of income for the year 1972-73. The income for that year was only Rs. 622. As regards the bad debts, we agree with the AAC and hold that the assessee is entitled to this deduction. He has noticed the details furnished to him. No account copy has been placed before us to show that they have already become bad and that they cannot be allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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