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TMI Blog2019 (4) TMI 1221X X X X Extracts X X X X X X X X Extracts X X X X ..... ee without reference to any query raised by the A.O. It is, thus, established on record that the A.O. did not examine this issue at assessment stage. Since no investigation or enquiry have been made on the present issue and the Ld. Pr. CIT passed the Order on 31.03.2016, therefore, Explanation-2 to Section 263 is clearly attracted in the present case The conditions of Explanation-2 to Section 263 of the I.T. Act which clearly satisfied in the present case. Therefore, the assessment order is clearly erroneous in so far as it is prejudicial to the interests of the Revenue on this issue. - Decided against assessee - ITA.No.3122/Del./2016 - - - Dated:- 18-4-2019 - Shri Bhavnesh Saini, Judicial Member And Shri N.K. Billaiya, Account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. CIT(A) has already granted relief to the assessee. The same grounds are, therefore, dismissed as not pressed. 5. On Ground Nos. 1 and 2, the assessee challenged the impugned order with regard to amount of debit balances written-off amounting to ₹ 1,03,591/- claimed as business loss under section 37 or under section 28 of the I.T. Act, 1961. 6. The Ld. Pr. CIT noted that assessee had debited ₹ 1,03,591/- on account of debit balances written-off. The details of this claim is not available on record. The A.O. did not examine as to whether the impugned written-off was shown as income in earlier years. Thus, the assessment order passed under section 143(3) of the I.T. Act, is erroneous and prejudicia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee has at the same time implicitly accepted that the above amount has not been reflected in the income of the assessee in the earlier years. The assessee has written off the advance stated to be irrecoverable. However, the amount so advanced is against a service or commodity as the case may be and should have formed the part of the receipt of the assessee. There is nothing like claiming nonrecoverable advances as expenditure/business loss. The assessee s argument is rejected. The assessment so framed is set aside on this issue. The A.O. is directed to reframe the assessment on the above issue after adding back the above mention amount of ₹ 1,03,591/-. 8. The Learned Counsel for the Assessee reite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowable deduction and in support of the same relied upon several decisions in the list of propositions. He has, therefore, submitted that impugned order may be set-aside and quashed. 9. On the other hand, Ld. CIT-D.R. relied upon the impugned Order of the Ld. Pr. CIT and submitted that A.O. did not examine the issue at assessment stage, therefore, it was correctly set-aside by the Ld. Pr. CIT under section 263 of the I.T. Act, 1961. The Ld. CIT-D.R. on merit also submitted that claim of assessee is not allowable because the assessee has not established that advance written-off has been taken into account as income of the assessee in previous year. Therefore, even on merit, assessee has no case of interference. The Ld. CIT-D. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner, the Order is passed without making inquiries or verification which should have been made. Thus, the conditions of Explanation-2 to Section 263 of the I.T. Act which clearly satisfied in the present case. Therefore, the assessment order is clearly erroneous in so far as it is prejudicial to the interests of the Revenue on this issue. The Ld. Pr. CIT, therefore, rightly exercised the jurisdiction under section 263 of the I.T. Act, 1961. The decisions relied upon by the Learned Counsel for the Assessee in the list are thus not applicable to the facts of the case. It may also be noted here that after passing of the revision order, the A.O. made addition against the assessee which is confirmed by the Ld.CIT(A) holding that the app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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