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TMI Blog2014 (8) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... s [2004 (5) TMI 16 - DELHI High Court] - If the debts were written off by the assessee itself, the situation is substantially different - It is only when those circumstances exist, that the occasion to take the amount from the purview of Section 41 of the Act, may arise - The issue is as to whether the assessee was under obligation to reflect the amount written off as an item of income - a unilateral act on its part did not have the effect of writing off, of the amount, it ought to have been reflected in the tax – the order of the Tribunal is upheld – Decided against Revenue. - I.T.T.A. Nos. 126 of 2001 - - - Dated:- 2-7-2014 - Sri L. Narasimha Reddy And M. Satyanarayana Murthy,JJ. For the Appellant : Sri S. R. Ashok For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest waived by the Bank, but dismissed the appeal, in respect of the other amount. In this view of the matter, the Revenue filed I.T.A.No.1738/Hyd/1996, feeling aggrieved by the order of the Commissioner, to the extent it has set aside the order of penalty in relation to ₹ 9,85,988/-. The respondent, on the other hand, filed I.T.A.No.1607/Hyd/1996 in relation to the other item. The Tribunal dismissed both the appeals through the order, dated 27.03.2001. Hence, these appeals under Section 260A of the Act. Sri S.R.Ashok, learned Senior Standing Counsel for the Department, submits that the Commissioner as well as the Tribunal erred in setting aside the proceedings under Section 271(1) (c) of the Act in relation to the first item. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the respondent, to conceal the items or source of income. Learned counsel further submits that the Tribunal has taken a hyper-technical view of the matter, in the context of giving effect to Section 41 (1) of the Act. He placed reliance upon certain precedents. The respondent claimed the benefit of deduction of the second item by stating the debts owed to him, by various persons or agencies became time barred. Section 41 of the Act is to the effect that where an Assessee gets the benefit of allowance or deduction in a particular assessment year, but thereafter, gets the benefit of that very amount or part of it, such amount shall be deemed to be profit or gains of business or profession and accordingly chargeable to income tax. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ke and the penalty to that extent was set aside. The Tribunal concurred with the finding. We too are of the same view. It is almost a case of understanding of the relevant provision of law by the Assessee. It is only when an amount, which is already allowed or deducted, that can constitute the subject matter of Section 41 (1) of the Act, cannot be rejected as irrelevant. It is a different matter that the amount was brought under the assessment. However, as long as there is possibility to understand the provision in different ways and the Assessee has chosen one, the occasion to invoke Section 271 of the Act does not arise. We draw support from the judgment of the Supreme Court in Commissioner of Income Tax Vs. Delhi Automobiles 272 ITR 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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