https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=768134 https://www.taxtmi.com/caselaws?id=768134 Addition on account of advances written off - claim made by the assessee was not admissible in terms of section 36(1)(vii) as these amounts were originally offered to tax and did not partake the character of debt - ITAT deleted addition - HELD THAT:- These are advances to more than 50 parties against which either the advances are not recoverable or the respondent-assessee has not received any services. The amount ranges from Rs.200 to Rs.3 lakh, major amounts being in few thousands. The DRP has not considered this letter and, therefore, observations made by the DRP that the claim is without evidence is incorrect. Tribunal has correctly considered the details filed along with letter dated 4 March 2014 and allowed the claim. It is also relevant to note that the total income declared by the respondent-assessee is more than Rs.30 crore and the net balance written off is only Rs.7,66,713/-. This comparison is only to show when the income offered is more than Rs.30 crore, small amounts write off would constitute reasonableness and moreso looking at the nature of the write off detailed in enclosure to letter dated 4 March 2014. Therefore Tribunal was justified in allowing the claim of the respondent-assessee. Deduction u/s 10B with respect to its Goa unit and Ambarnath unit - DRP denied the deduction under section 10b on "Site Transfer Income" on the ground that same does not represent the income derived from the business of eligible unit - HELD THAT:- Tribunal has merely stated that after hearing both the parties and perusing the orders and judgments, the Site Transfer Income is eligible for deduction under Section 10B of the Act. In our view, this does not amount to reasons for coming to the conclusion. The tribunal ought to have given the reasons as to how "Site Transfer Income" constitutes the income derived from the business of the undertaking. The said reasoning is totally absent. The operative part is only the conclusion but before coming to the conclusion, the Tribunal ought to have given its reasons moreso, since it is the case of reversal of the order passed by the AO and DRP and the Tribunal being the final fact authority and first appellate authority in this case was expected to give the reasons before coming to the conclusion which are absent in the present case. In Union of India Vs Mohan Lal Capoor [1973 (9) TMI 99 - SUPREME COURT] the Hon'ble Supreme Court explained that reasons are the links between the materials on which certain conclusions are based and the actual conclusions. They should reveal a rational nexus between the facts considered and the conclusions reached." We, therefore, remand the matter back to the Tribunal for deciding the ground of deduction under Section 10B qua "Site Transfer Income." Tribunal would give opportunity of hearing to both the parties and thereafter pass a reasoned order keeping in mind the guidelines laid down in the case of Santosh Hazari [2001 (2) TMI 131 - SUPREME COURT] and other decisions which are reproduced above. Case-Laws Income Tax Wed, 26 Mar 2025 00:00:00 +0530