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TMI Blog2020 (8) TMI 668X X X X Extracts X X X X X X X X Extracts X X X X ..... e debtors and amounts shown in books of accounts of the assessee are matched. It is a settled position of law that mere entries in the books of accounts are not conclusive enough to make an assessment without verifying the veracity/authenticity of the same. Claim of the assessee is that amount debited under the head bad debt account is in fact reversal of income recognised in books of accounts on advances received from customers in earlier financial years on the basis of confirmation from the debtors. The assessee claims that it is a reversal of income recognised in earlier financial years, whereas the A.O. claims that the amount represents bad debts written off. If, the claim of the assessee is correct, then it needs to be allowed as deduction, because income to that extent was already offered to tax for earlier years. But, this fact is not clear from the order of the AO as well as the CIT(A). Therefore, the issue needs to be re-examined by the A.O. in the light of various averments made by the assessee. Hence, we set aside the issue to the file of the A.O. and direct him to reframe the assessment de-novo in accordance with law after considering necessary evidences filed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have considered the correct income and ought to have brought to tax or assessed the income independently by allowing all the benefits and reliefs available to the assessee, on the facts and circumstances of the case. 3.5 The learned authorities are not justified in law in rejecting the claim of the appellant unreasonably without proper appreciation of the proofs and submissions made by the appellant which is against the principles of natural justice, on the facts and circumstances of the case. 4. The authorities below ought to have appreciated that consent does not confer jurisdiction and taxes are to paid in accordance with the scheme of the act and no tax can be collected without the authority of law, on the facts and circumstances of the case. 4.1 The learned Commissioner of Income-tax [Appeals] failed to appreciate that the learned assessing officer for the purposes of computing the total assessed income of the appellant in the computation has considered the income declared by the appellant in its original return of income of ₹ 31,46,610/-instead of considering the revised total income declared by the appellant in the valid revised return of income in whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eduction of income to the extent of ₹ 64,12,499/- and the same has been debited to bad debts accounts for which necessary evidences including ledger extract of the parties have been furnished. The A.O. was not convinced with the explanation of the assessee and according to him, the assessee claims to have debited bad debts accounts, the amount of reversal of income already offered for earlier years, but failed to furnish supporting evidences to prove that the amount is in fat bad debt and accordingly opined that amount debited to bad debt accounts cannot be allowed as deduction. Accordingly, made additions of ₹ 64,12,499/- to the returned income. 4. Being aggrieved by the assessment order, the assessee preferred an appeal before the CIT(A). Before the CIT(A), the assessee had reiterated its arguments made before the A.O. The assessee further submitted that amount debited under the head bad debts is in fact reversal of income offered in earlier financial years on advances received from customers on the basis of percentage completion method. Further, it was subsequently noticed that amount received from customers is only an advance on which income was not accrued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/-, which is as per return of income filed on 27.11.2014. Therefore, he submitted that in all fairness, the issue needs to be set aside to the file of A.O. to verify the facts and to decide the issue in accordance with law. 6. The Ld. D.R. for the revenue on the other hand strongly supporting order of the CIT(A) submitted that the A.O. as well as the Ld. CIT(A) had recorded categorical finding in the light of various details filed by the assessee and also on the basis of admission of authorised representative for the assessee before the A.O. that amount debited to bad debt account is in fact income of the assessee. Therefore, there is no reason to take different view at this point of time. However, he fairly admitted that the issue may be set aside to the file of the A.O. to look into the arguments of the assessee in the light of various averments made during the course of hearing. 7. We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. Admittedly, the A.O. had considered revised return filed by the assessee at the time of assessment proceedings which is evident from the fact that the addition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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