2014 (10) TMI 106

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..... e ITAT is correct in directing the AO to allow the entire head officer expenditure under Section 37(1) of the Act, without appreciating the fact that the allowability of head office expenditure is governed by the provisions of section 44C of the said Act and accordingly the said head office expenditure is to be allowed to the assessee at 5% of the adjusted total income as per provisions of section 44C of the Act. (2) Whether on the facts and circumstances of the case and in law, the ITAT is correct in holding that the assessee has fulfilled the conditions of Sec 36(1)(vii) and 36(2) of the Act in respect of it's claim of bad debt written off to the tune of Rs. 43,39,01,201/- without appreciating the fact that the advances to D.B. Finan .....

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..... 463on identical issue relating to Assessment Year 1984-85. Thereafter, for the Assessment Year 1994 - 95, Revenue had come up in appeal with regard to the same issue and this Court by its order dated 20th November, 2012 had refused to entertain the same as the issue was covered by the order of this Court in Respondent-Assessee's own case in Deutsche Bank AG (supra). Thereafter, the Revenue took out a Review Petition seeking a review of the order dated 20th November 2012 on the ground that the question not entertained on the basis of the decision of this Court in Deutsche Bank AG's case (supra) was not correct as the law had undergone a change after the Assessment Year 1984-85. In its Review Petition, the Revenue contended that Secti .....

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..... ompany was not sound. In view of the above, the Assessing Officer was of the view that the advances given by the Respondent-Assessee to its associate company was not in the ordinary course of business, and therefore, could not be written off as bad debts. 7. On first Appeal, the CIT (A) after examining the transaction came to the conclusion that the advance was given by the Respondent-Assessee to its associate company was in the course of its banking business. A factual finding is also recorded that the advance made to the associate company was lost only on account of security scam in Assessment Year 1993-94 which resulted in the market crashing and consequent losses of the associate company. Thus, the CIT(A) held that when the Respondent- .....

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