TaxTMI 
TaxTMI 
2011 (3) TMI 1553
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.... completed at a total income of Rs. 3,10,75,610, inter alia, making following disallowances : 1. Sundry balances written off Rs. 60,54,678 (as discussed in para 5 above) 2. Bad debts written off Rs. 96,05,42,627 (as discussed in para 6 above) 3. The learned CIT(A) confirmed the disallowances. 4. Being aggrieved, the assessee is in appeal before us and has taken, inter alia, the following grounds of appeal : "2. The learned lower authorities have grossly erred in making/confirming an addition of Rs. 60,54,678 being the sundry balances written off without ....
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....he amounts of all above parties were merely brought forward balances since past 7-8 years. In the absence of any communication with the above parties since past several years and non-availability of old records, the addresses of said parties were not readily available. The AO inferred as under : (a) The addresses of the parties have not been submitted. (b) No concrete action has been taken for recovery. (c) No documents related to the said transactions have been submitted. (d) The genuineness of the transactions itself has not been substantiated. The AO referred to the provisions of s. 36(1)(vii) relating to set off of bad debts and pointed out that the assessee's nature of transaction does not fit into any of the provisi....
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.... provided (Rs. 13,46,306 + Rs. 6,54,454) 20,00,000 Manav International 1,56,176 Raja Seth Finance Ltd. 10,00,000 Tunga Alloys Ltd, 81,600 Vigilante Services (P) Ltd. 3,00,000 H.W.J. Wills Interest account 3,06,57,162 Knowledge Book Centre 29,890 B 3,58,13,541 Net amount written off (A B) 60,54,579 It is further submitted that most of the credit/debit balances were attributable to excess provision of income receivable/expenses payable and/or advances made/received during the course of business long back. However, due to passage of time and frequent changes in the executive staff, the company could not keep a track on these parties and consequently the balances were being brou....
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....bstantiate its claim with supporting evidence. The assessee submitted the following details : "(a) Full address of the parties (i) M/s Freeway Supplies Ltd., (ii) M/s H. W.J. Wills & Partners Ltd. London, 1st Floor, 374, Edgware Road, London W21EB. (b) Resolution of the board regarding write off of foreign debtors dt. 23rd Sept., 2002. (c) Bill-wise details of debts written off along with copy of relevant sale invoices. (e) MoU executed dt. 10th Nov., 1998, and 3rd Aug., 1999, between the assessee and M/s Freeway Supplies Ltd., London and M/s H.W.J. Wills & Partners Ltd., London, pertaining to the debts whose execution was subject to the permission....
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....d. vs. CIT (2010) 230 CTR (SC) 14: (2010) 35 DTR (SC) 156: (2010) 323 ITR 397(SC). He further referred to the decision of the Tribunal in the case of Sashak Noble Metals Ltd. vs. ITO, ITA No. 2211/Mum./2006, vide order dt. 25th Aug., 2010, and pointed out that merely because the RBI's approval was not there, assessee's claim cannot be denied. RBI's directives do not override the provisions of the Act. In this regard, he relied on the decision of Hon'ble Madras High Court in the case of T.N. Power Finance & Infrastructure Development Corporation Ltd. vs. Jt. CIT (2006) 280 ITR 491(Mad) wherein it was held that RBI directives cannot override the statutory provisions of Explanation to s. 36(1)(vii) of the Act, No set off of los....
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....ith the copy of relevant sale invoices, MoU and law suit filed on 11th April, 2002. In this case also, the board resolution was passed on 31st Oct., 2002, i.e., during subsequent year and under these facts, the Tribunal followed the decision of Hon'ble Supreme Court, taking into consideration all the facts, the Tribunal had clearly recorded that the assessee had been penalizied for violation of the provisions of FERA on this account and penalty of Rs. 6,00,00,000, had been levied vide order of FERA, dt. 12th March, 2005. In the present case, there is no such penalty being levied under the FERA. However nothing turns on this count because the main objection of the Department is that since the debt pertained to a foreign party, it could n....