TaxTMI 
TaxTMI 
2015 (5) TMI 231
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.... of law : "A) Whether on the facts and in the circumstances of the case the ITAT erred in law in deleting the addition of Rs. 20,05,744/- being provision for doubtful debt on the ground, that the provision for doubtful debt are doubtful for recovery and therefore cannot be equated with liability, which is contrary to provisions of Section 115JA, by ignoring the finding of the CIT(A) that the entire provision represented advances towards sister concern and not trade debts and that it was an adhoc provision made towards advances of doubtful recovery and therefore cannot be treated as unascertained liability u/s 115JA? B) Whether on the facts and in the circumstances of the case the ITAT erred in law by deleting the interest u/s 234B&C o....
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.... Act, it was noted that the provision represented advances made by the respondent assessee to its sister concern and the non-recovery of the same was provided as provision for bad debts on an adhoc basis. The CIT(A) held the same to be covered by clause (c) of explanation to Section 115JA(2) of the Act as being in the nature of unascertained liability. So far as interest payable under Section 234B and 234C of the Act as default and delay of advance tax payment was concerned, the order of the Assessing Officer was upheld. 5. Being aggrieved by the order dated 23/02/2001 of CIT(A), the respondent filed an appeal to the Tribunal. By the impugned order, the Tribunal held that the provision in respect of doubtful debts is not a liability much....
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.... been debited to the profit and loss account under the head provision for doubtful debts, would stand covered by clause (c) of the explanation to Section 115JA(2) of the Act. It is further submitted that in the present facts, there is no justification for the Tribunal to delete the addition of provision for doubtful debts made to the book profits of Rs. 20.5 lakhs under Section 115JA of the Act. (iii) Mr. Bhobe, learned Counsel for the respondent assessee reiterates the findings in the impugned order. (iv) It is very clear from the language of clause (c) of the explanation to Section 115JA(2) of the Act that it only refers to the amount set aside for provisions made for meeting liabilities, which are not ascertained. In the present ca....
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.... receivable by the assessee. A debt is payable by the assessee where the assessee has to pay the amount to others whereas the debt receivable by the assessee is an amount which the assessee has to receive from others. In the present case 'debt" under consideration is 'debt receivable" by the assessee." In this case also, there is no debt payable by the respondent assessee, but it is a debt receivable and would not stand covered by clause (c) of the explanation to Section 115JA(2) of the Act. Thus, the issue stands concluded in favour of the respondent by the decision of the Apex Court in HCL Connect System and Services Ltd (supra) and Rolta India Ltd (supra). (v) In view of the above, the substantial question of law at serial ....