2016 (1) TMI 229

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.... : Mr. P.C.Goyal, Advocate Ajay Kumar Mittal,J. 1. This appeal has been preferred by the appellant-revenue under section 260A of the Income Tax Act, 1961 (in short, "the Act) against the order dated 27.3.2009, Annexure IV passed by the Income Tax Appellate Tribunal, Delhi Bench 'I' New Delhi (in short, "the Tribunal") in ITA No.2659/Del./2005 for the assessment year 1996-97, claiming....

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....,905/- and loss of Rs. 89,80,454/- was allowed to be carried forward. The Assessing officer made a disallowance of Rs. 36,40,481/- on account of bad debts on the ground that the assessee had failed to give any plausible explanation vide order dated 30.3.1999, Annexure I. The assessee did not produce evidence of the debt becoming bad in the case of all the parties. On appeal by the assessee, the CI....

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....l. The Tribunal held that the amount of Rs. 2,18,213/- was the advance made to M/s Chemicals of India for the purchase of material. The material was not received by the assessee. The expenditure was in the course of the business of the assessee. Therefore, the Assessing officer was directed to allow the said amount as a business expenditure. 5. While reversing the findings recorded by the CIT(A....

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....s not received by the assessee. It is also not disputed that this expenditure was in the course of the business of the assessee. This being so, we are of the view that this expenditure can be claimed as a business expenditure itself. In the circumstances, the finding of the CIT(A) on this issue stands reversed and the AO is directed to allow the said amount as a business expenditure." 6. The Tr....