TaxTMI 
TaxTMI 
2015 (9) TMI 1418
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.... Grievance raised by the assessee 1.1 The order passed u/s. 250 on 22.11.2011 for A.Y. 2008-09 by CIT(A)-GNR, Abad upholding the disallowance of Rs. 10,11,887 made by AO is wholly illegal, unlawful and against the principles of natural justice. 1.2 The Ld. CIT(A) has grievously erred in law and or on facts in not considering fully and properly the submissions made and evidence produced by the appellant with regard to the impugned additions. 2.1 The Ld. CIT(A) has grievously erred in law and on facts in confirming the disallowance of the claim of bad debts/trading loss for Rs. 10,11,887 in respect of M/s. Quality Foods and S.N. Das Freight Forwarders Pvt. Ltd. 2.2 That in the facts and circumstances of the....
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.... It was noted that following debts were claimed to have become bad:- (1) A.P. Sayona Trade Association, Singapore F.Y. 2004-05 Rs.9,06,980 For sales of goods (2) Devkinandan Trading Co. F.Y. 2004-05 Rs.10,38,500 Demurrage charges paid due to delay (3) Quality Foods F.Y. 2004-05 Rs.7,12,500 Advance given for purchase of onion powder (4) S.Y.P. Exporter F.Y. 2004-05 Rs.17,00,000 Advance given for purchase of potato powder (5) S.N. Das Freight Forwarders Pvt. Ltd. F.Y. 2005-06 Rs.2,99,387 Irrecoverable amount on transportation (6) Sakar Overseas Pvt. Ltd. F.Y. 2004-05 Rs.2,72,11,993 Advance given for purchase of dehydrated onion flakes (7) Shree Ram Trading Co.....
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....to it's original claim of bad debts, that the amount should be allowed as a business loss. The submissions received from the assessee, as also accompanying supporting documents, were confronted to the Assessing Officer and remand report was also obtained from the Assessing Officer. Learned CIT(A) concluded that to the extent transactions in question were not disputed and the assessee has demonstrated that loss has actually incurred, the same is to be allowed as deduction as business loss. It was also noted that the assessee had exported substantial qualities of agricultural processed goods, including dehydrated garlic flakes and white onion power, and it was in this connection that the assessee bonafide and in the course of normal business ....
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....asic thrust of the arguments is that since the loss is not incurred in the course of business carried on by the assessee, it should not be allowed as a deduction. However, it is an undisputed position that the assessee did in fact trade in processed agricultural produce, in connection with which advances in question were made, and it was in the course of this trading that business loss of making unrecoverable advances was incurred. The losses were thus wholly incidental to the business carried on by the assessee. There may not be any trading transactions of these products in the current year but the business of the assessee has not come to a halt. No doubt, criminal complaint filed by the assessee had not reached finality and the persons, w....