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TMI Blog2015 (11) TMI 1830X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee on the expenditure incurred and for which no set of was available was rightly written off and the order of the ld. CIT (A) cannot be sustained on this point. Assessee has rightly written off the un-receivable insurance claim during the year which were either rejected or short accepted by the insurance company. More so when these expenses are not related to the prior period as the circumstances and facts under which these amounts were written off came to be finalized during the year. Assessee further pointed out that the similar expenditure were allowed by the Department in the earlier years. All these write offs are necessitated when their adjustments or recovery is not possible to be made in the in the normal course of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eled Wire. During the year the assessee filed its return of income at ₹ 23,165/- through e-filing. 3. The case of the assessee was selected for scrutiny and the ld. Assessing Officer (A.O.) assessed income at ₹ 12,38,870/-by disallowing , inter alia, service tax of ₹ 2,05,177/- and insurance claim of ₹ 4,13,147 to the income of the assessee as prior expenses on the basis of tax audit report clause 22(b)(i) filed by the assessee by rejecting the plea of the assessee that the write offs relates to the instant year. The brief facts of the case are that the assessee wrote off service tax of ₹ 2,05,177/-- and insurance claim not paid by the insurance companies of ₹ 4,13,147/- against income during the year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not available . The ld counsel further submitted that service tax credit is only allowed when the expenses were incurred which are directly connected to manufacturing and not otherwise. As against the short insurance claim of ₹ 4,13,147/-, the learned officer submitted that out of total claim of ₹ 40,97,649/- made on 31st May, 2006, only ₹ 36,84,503 was either received from Insurance Company or written off in the earlier years which means that ₹ 4,13,147/- was also claimed from the insurance company but not admitted and therefore was ultimately written off in the instant year. It was also argued that the service tax of ₹ 2,05,177/- and insurance claim of ₹ 4,13,147/- were rightly claimed by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amounts were written off came to be finalized during the year. The ld. Counsel of the assessee further pointed out that the similar expenditure were allowed by the Department in the earlier years. All these write offs are necessitated when their adjustments or recovery is not possible to be made in the in the normal course of business . In the case of CIT Vs Excel Fashion Pvt Ltd (Supra), the Hon ble High Court of Delhi has upheld the order of Tribunal in which the tribunal allowed the irrecoverable Export Incentives as bad debt. Under these facts and circumstances and in view of the decision In the case of CIT Vs Excel Fashion Pvt Ltd (Supra), the order passed by CIT(A) can not be sustained on these points and, therefore, the disallowanc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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