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TMI Blog2019 (11) TMI 976X X X X Extracts X X X X X X X X Extracts X X X X ..... nce on account of miscellaneous expenses written off - HELD THAT:- As rightly contended by the learned DR in this regard, such details are not furnished by the assessee either before the AO and before the Ld. CIT(A) to show the nature of expenses and the basis on which the same are written off in the year under consideration. He has contended that this matter may therefore be sent back to the AO for verification. We find merit in this contention of the learned DR. The impugned order of the Ld. CIT(A) on this issue is accordingly set aside and the matter is restored to the file of the AO for deciding the same afresh after verifying the relevant details to ascertain the exact nature of expenses claimed by the assessee as well as the basis of the writing off the same. Ground No. 2 of the assessee s appeal is treated as allowed for statistical purpose. Disallowance of expenditure under the head membership fees and subscription - revenue or capital expenditure - HELD THAT:- Assessee has submitted that it was annual fees paid by the assessee to Hotel Oberai and not an entrance fees. He however has not brought on record any documentary evidence to show that the amount in question represen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of account for the year under consideration. This explanation of the assessee was not found acceptable by the AO. According to him, the total fees of ₹ 3,75,000/- was receivable by the assessee from each student and since the assessee was likely to have received at least 1/4th of such fees upfront, the write off of almost the entire fees receivable from 16 students was not acceptable. He accordingly disallowed the deduction claimed by the assessee on account of bad debts written off in the assessment completed u/s 143(3) vide an order dated 29.12.2009. 4. The disallowance made by the AO on account of bad debts written off was challenged by the assessee in the appeal filed before the Ld. CIT(A) and since the submission made by the assessee in support of its case on this issue was not found acceptable by him, the Ld. CIT(A) confirmed the disallowance made by the AO on this issue for the following reasons given in paragraph no 4 of his impugned order: 4. The first ground of appeal is against disallowance of bad debts of ₹ 53,15,574/- written off. The AO examined the details furnished during the assessment proceedings and observed that certain students stopped short of pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtly from the students and therefore, the claim of the assessee for write off of almost entire course fees receivable from 16 students as irrecoverable was rightly not accepted by the authorities below. He also contended that the relevant details to support and substantiate its claim for the bad debts written off were not fully furnished by the assessee either before the AO or before the Ld. CIT(A). 7. We have considered the rival submissions and also perused the relevant material available on record. It is observed that the relevant details in respect of its claim for bad debts written off were furnished by the assessee during the course of assessment proceedings before the AO and only on perusal of the same, it was found by the AO that almost the entire course fees receivable by the assessee from 16 students was written off by the assessee as bad debts. As rightly contended by the learned counsel for the assessee, the said course fees having been offered by the assessee company as its income and the same having been written off in the books of account as irrecoverable, the conditions stipulated in section 3(1)(iii) read with section 36(2) were duly satisfied and the assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nses written off is upheld by the Tribunal vide its order dated 03.05.2019. He has also filed a copy of the said order and a perusal of the same shows that the miscellaneous expense claimed by the assessee was inclusive of preliminary expenses, pre-operative expenses, deferred revenue expenses and portal development expenses. As rightly contended by the learned DR in this regard, such details are not furnished by the assessee either before the AO and before the Ld. CIT(A) to show the nature of expenses and the basis on which the same are written off in the year under consideration. He has contended that this matter may therefore be sent back to the AO for verification. We find merit in this contention of the learned DR. The impugned order of the Ld. CIT(A) on this issue is accordingly set aside and the matter is restored to the file of the AO for deciding the same afresh after verifying the relevant details to ascertain the exact nature of expenses claimed by the assessee as well as the basis of the writing off the same. Ground No. 2 of the assessee s appeal is treated as allowed for statistical purpose. 12. As regards ground No. 3, it is observed that the expenditure of ₹ 30 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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