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TMI Blog2015 (2) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... k profit of the assessee under S.115JB of the Act. On the other hand, if it is found that the amount in question represented only the provision made by the assessee for bad and doubtful debts, without actually writing off the relevant debts as irrecoverable in the books of account, the same is liable to be disallowed and added back while computing the book profit of the assessee under S.115JB, as per clause (i) of Explanation 1 under S.115JB, being the amount set apart as provision for diminution in the value of the asset. We therefore, restore this issue also to the file of the Assessing Officer for deciding the same afresh in accordance with law after giving sufficient opportunity of hearing to the assessee. - Decided in favour of Revenue for statistical purposes. 100% depreciation on assets whose value is below ₹ 5000/- - Held that:- It is not a case of granting 100% depreciation on assets having value below ₹ 5,000 as made out by the Revenue in its ground. As a matter of fact, the case of the assessee before the learned CIT(A) was that the amount in question represented small spares worth less than ₹ 5,000 purchased during the year under consideration, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 18.83 crores i) Wheeling charges - ₹ 89.45 crores : Wheeling charges are being levied as part of Tariff to the HT consumers and the consumers have disputed and cases are pending in High Court since long time. The management has assessed as doubtful regarding is recovery and opined to make a provision for doubtful debts. ii) LT arrears - ₹ 18.83 crores : The ageing analysis of Sundry debtors reveals that an amount of ₹ 18.83 cores represents the accumulated arrears more than 5 years. The management has assessed as doubtful regarding its recovery and opined to make a provision for doubtful debts. The above explanation of the assessee was not found acceptable by the Assessing Officer. According to him, the provision made by the assessee for doubtful debts was an unascertained liability and in the absence of any satisfactory explanation offered by the assessee as to how the same represented an allowable expenditure for the year under consideration, the same was liable to be disallowed. Accordingly, the claim of the assessee for doubtful debts amounting to ₹ 108.28 cores was disallowed by the Assessing Officer in the assessment completed under S.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actually been written off as irrecoverable in the books of the assessee for the year under consideration. Keeping in view the submissions made by both the sides, we consider it fair and proper to restore this issue to the file of the Assessing Officer for the limited purpose of verifying as to whether the relevant debts claimed as bad have actually been written off by the assessee in the books of account for the year under consideration as irrecoverable. If it is found on such verification that the relevant bad debts have actually been written off as irrecoverable by the assessee, the Assessing Officer is directed to allow the claim of the assessee for bad debts to that extent. The Assessing Officer shall accordingly redecide this issue in accordance with law and after giving sufficient opportunity of hearing to the assessee. 6. In the result, cross appeals for assessment year 2008- 09 are allowed for statistical purposes. Cross Appeals for assessment year 2009-10: 7. Now, we shall take up the cross appeals for assessment year 2009-10, which are directed against the order of the learned CIT(A) II, Hyderabad dated 4.11.2013. 8. As regards the assessee s appeal for asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , grounds No.1 and 4 are general in nature, requiring no specific adjudication. 11. As regards the issue involved in ground No.2, relating to the disallowance to be made on account of bad debts, while calculating the book profit of the assessee company under S.115JB of the Act, it is to be noted that the issue relating to disallowance of bad debts, while computing the income of the assessee under the normal provisions of the Act has already been restored by us to the file of the Assessing Officer, while disposing off the appeal of the assessee for assessment year 2009-10 for the limited purpose of verifying as to whether the relevant debts claimed by the assessee as bad have already been written off in the books of account as irrecoverable. In our opinion, this aspect has a direct bearing on the issue involved in ground no.2 of the Revenue s appeal in as much as if the relevant debts claimed to be bad by the assessee, are found to have been written off in the books of account as recoverable, no disallowance can be made on account of bad debts written off either while computing the income of the assessee under the normal provisions of the Act or even for computing the book profit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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