TaxTMI 
TaxTMI 
2014 (2) TMI 317
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....e learned CIT(A) is not acceptable as it is erroneous both in law and facts. 2. The learned CIT(A) erred in law in not appreciating that following waiver of loan of Rs.12,72,180/-, it amounts to receipt of that amount by the assessee during the previous year and the same being retained for business purpose of the assessee, the same is assessable as income for the Assessment Year 2007-08 in this case following ratio of decision of Bombay High Court in Solid Containers Ltd. vs. DCIT & another (2009) 308 ITR 417 and also in view of the decision in Logitronics Pvt. Ltd. vs. CIT (2011) 333 ITR 386 (Del.) 3. The observation of the learned CIT(A) that prima facie, the deficit returned by the appellant is valid, is not correct in as much as t....
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....ciple of loan from A.P. State Film Development Corporation Ltd, a loan obtained in earlier years. A.O. considering that assessee is a company therefore, must inevitably follow mercantile system of accounting held that waiver of principal amount of Rs.12,72,180/- should be treated as income from property held under the trust. 5. Before the CIT(A), it was contended that neither the amount has been claimed as expenditure nor as application for charitable purpose in any of the years so, the waiver of the principal amount may not come under the provisions of income of the trust. It supported its contention by referring to various balance sheets in the earlier years and computation of incomes. The learned CIT(A) having considered the submissio....
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....case law relied upon by the Revenue pertain to computation of income under head "Business" which does not apply to the assessee at all. Therefore, we are of the opinion that the waiver of the loan cannot be treated as income as the assessee has not claimed any deduction earlier on the loan amount, which is on capital account. Therefore, order of the CIT(A) is upheld and ground is rejected. 8. The next issue raised by the Revenue is with reference to computation of income shown by the assessee in the return of income. The assessee while filing the return of income has shown an amount of Rs.50,61,138/- as excess of expenditure over income. The A.O. ignored the said computation and also noted that since assessee had excess expenditure over ....
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.... facts are distinguishable in the sense that in that case earlier years incomes were set off for current year's expenses whereas in the facts of the present case current year's income alone was utilised for set off of expenses under the year under report. Thus, the ratio of that decision is not applicable in the case of the appellant for the impugned assessment year under consideration and as such the decision of the A.O. is reversed i.e., the income, if any is entitled for exemption under the provisions of section 11(1)(a). Since, it is held that the appellant is entitled for exemption under section 11(1)(a), prima facie the deficit returned by the appellant is valid, which may be modified subject to the decisions of the undersigned on var....