9911796707
TMI Blog2009 (1) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that it had merely been reflected in the books of account to pressurize the loanees to make the payment. The Assessing Officer did not accept the plea advanced by the respondent-assessee and accordingly, included the interest component of Rs.26,09,621 to the returned income of the assessee. 2. Not satisfied with the determination rendered by the Assessing Officer, the respondent-assessee preferred an appeal before the Commissioner of Income Tax (Appeals). The appeal preferred by the respondent-assessee was disposed of by an order dated 27.9.2000. The Commissioner of Income Tax (Appeals) accepted the appeal preferred by the respondent-assessee and in determining the issue under reference arrived at the conclusion that during the cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction, or that, interest arises out of a contract the terms and conditions whereof are the same as the ones which are the subject of consideration at the present juncture. 6. The second contention advanced on behalf of the learned counsel for the appellant directly flows from Section 36 of the Income Tax Act, 1961 (hereinafter referred to as the Act) under which the present deduction has been sought by the respondent-assessee. So far the present controversy is concerned, only sub-clause (vii) of Section 36(1) of the Act is relevant. Accordingly, Section 36(1)(vii) of the Act is being extracted hereunder:- "S.36(1) The deductions provided for in the following clauses shall be allowed in respect of the matters dealt with therein, in computi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o justification to make any reference thereto as the issue in the present appeal can be determined on the basis of a plain reading of sub-clause (vii) of Section 36(1) of the Act itself. 9. When confronted with the first submission advanced by learned counsel for the appellant, it is the case of the learned counsel for the respondent-assessee, that the entire material was placed by the respondent-assessee before the Assessing Officer, as well as before the Commissioner of Income Tax (Appeals), and that, the response of the respondent-assessee to the Courts' query would remain the same. The stance adopted by the respondent-assessee before the authorities below has been noticed in the order passed by the Commissioner of Income Tax (Appeals). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11. During he course of hearing, learned counsel for the respondent-assessee handed over to us in Court the order passed by the Commissioner of Income Tax (Appeals) dated 30.9.1997, the same is taken on record and marked as Annexure A. A perusal of Annexure A reveals that the matter which had come up for consideration was for the assessment year 1992-93. Paragraph 2.1 of the aforesaid order reveals that the respondent-assessee during the course of the proceedings of the assessment year 1991-92, had made a claim of deduction to the Assessing Officer in respect of a sum of Rs.27 lacs, and that, the aforesaid claim for deduction was accepted by the Assessing Officer. That being so, the deduction referred to by the Commissioner of Income Tax ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the issue of deduction of Rs. 26,09,621/- claimed by the respondent-assessee under Section 36(1)(vii) of the Act. 12. Parties are accordingly directed to appear before the Assessing Officer on 2.2.2009. 13. In so far as the second contention advanced by the learned counsel for the appellant is concerned, we find no ambiguity therein whatsoever. In case the deduction is sought by the respondent-assessee under Section 36(1)(vii) of the Act, it would obviously be imperative for him first to demonstrate that the deduction he desires to seek is on account of a bad debt, secondly, that the aforesaid debt was written off as irrecoverable, and thirdly, it should have been written off as an irrecoverable debt in the previous year. The instant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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