TaxTMI 
TaxTMI 
2016 (11) TMI 880
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....ance, dehydrated vegetable and its allied products, filed a return of income on 12.10.2010 declaring income from business at Rs. 11,45,392/- before set off of brought forward losses and NIL income after set off of brought forwarded losses. The assessment was completed u/s 143(3) of the Income Tax Act, 1961 (in short 'the Act') on 12.3.2013 determining the income at Rs. 18,31,994/- before set off of brought forwarded losses and NIL income after set off of brought forward losses. While completing the assessment, the Assessing Officer made an addition of Rs. 34,750/- observing that the assessee could not explain why this amount was written off in the books of account and no details were furnished by the assessee. The Assessing Officer also dis....
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...., submits that out of total deposit of Rs. 12,78,000/-, assessee has adjusted Rs. 9,52,074/- and the balance of Rs. 3,25,926/-, which could not be adjusted, has been written off. Similarly, in respect of another property, similar amount of Rs. 3,25,926/-, which could not be adjusted against the rent, was written off as there was dispute between the lessors and the assessee on the amount of municipal taxes and later on the assessee has vacated the premises. Therefore, since these amounts are not recoverable and as these amounts could not be adjusted, these were written off in the books of account and claimed as deduction. The learned counsel for the assessee submits that these amounts if not allowed u/s 36 of the Act, it should be allowed u/....
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....fore the Assessing Officer but it was produced only before the CIT(A) and CIT(A) has not entertained these details in the absence of proper explanation. In our considered view, as these details were not there before the Assessing Officer, it should go back to the Assessing Officer for afresh adjudication and the assessee should produce all these details before the Assessing Officer, especially when it was contested that these amounts were already offered as income and by this addition it will be a double taxation. Thus, we restore the matter to the file of Assessing Officer who shall examine the claim of assessee afresh in accordance with law after providing assessee adequate opportunity of being heard. Regarding the amount written off of R....
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....arts of the country, and this act of taking this show room on lease is in the normal course of business. In fact 84 show rooms are taken on lease at various placed. Six months rent was given as security deposit. This was given in the course of business. The transaction is intimately connected with the business of the assessee. The Assessing Officer has not disputed the genuineness of the claim. The CIT(A) has disallowed the amount on the ground that the loss was in the capital field. We do not agree with this finding. There is no enduring benefit to the assessee. In our view the loss in question is in the revenue field and has been rightly claimed u/s 28. This is not a bad debt. It is not a case where "lease premium" is paid for a long term....
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....nal though originally it was claimed as a bad debt. The amount in question was given, not for acquiring of any asset giving enduring benefit and was incurred in the course of trade and hence is in the revenue field. The Hon'ble Supreme Court in the case of Empire Jute Co. Ltd. vs. CIT 124 ITR p.1 (SC) has held as follows. "BY THE COURT: (i) It is not universally true proposition that what may be a capital receipt in the hands of the payee must necessarily be capital expenditure in relation to the payer. The fact that a certain payment constitutes income or capital receipt in the hands of the recipient is not material in determining whether the payment is revenue or capital disbursement qua the payer. (ii) There may be cases where expe....