TaxTMI 
TaxTMI 
2017 (6) TMI 494
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.... being alternative grounds which do not require appreciation of new facts and therefore, taken on record. The final grounds of appeal reads as under:- 1.1 The commissioner of Income Tax-12, Mumbai erred in confirming the disallowance of Rs. 5,30,47,066/- made u/s 36 of the IT Act on the ground that only bad debt is allowable under the above provision and the provision for the doubtful debt made in account is not allowable. 1.2 The appellant submits that, no amount is recovered out of the above debt for which the provision was made even till today and hence the said amount of provision should have been allowed as business loss/ bad debt u/s 36/37 of IT Act. 1.3 The Ld. CIT(A) erred in treating losses written off during the year as provi....
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....oceedings, the learned AR fairly informed that the impugned amounts are in the nature of "provisions" only. On verification of ledger accounts filed by the learned A.R. during the appellate proceedings, it is seen that the impugned amounts are not written off and still outstanding in the books of the appellant company. Thus, it has now become clear that the impugned amounts represent 'provisions' only. As per Explanation to Section 36(i)(vii) of the Act, "for the purpose of this clause, any bad debts or part thereof written off as irrecoverable shall not include any provision for bad and doubtful debts made in the accounts of the assessee." As such, the assessee's claim u/s 36(i)(vii) is not tenable. Moreover, it is also not established tha....
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....8(i) of the Income Tax Act. Reliance has been placed on following judicial pronouncements for various contentions:- (i) Vijaya Bank Vs. CIT [SC 323 ITR 166 2010] (ii) Southern Technologies Ltd. Vs. JCIT [SC 320 TR 577] (iii) CIT Vs. Tainwala Chemicals & Plastics India Ltd. [Bombay HC 215 Taxmann 153] (iv) CIT Vs. Newanagar Co-operative Bank Ltd. [Gujarat HC 54 Taxmann.com 28] (v) CIT Vs. Abdul Razak & Co. [Gujarat High Court 1982 136 ITR 825] (vi) ACIT Vs. Hi-Lines Pens Pvt. Ltd. [Delhi Tribunal ITA No. 2925/Delhi/2012] (vii) Minda (HUF) Limited Vs. JCIT [Delhi Tribunal 101 ITD 191] 5. Per contra, Ld. DR placed reliance on the findings of Ld. CIT(A) and contended that no deduction could be allowed against provisions for advan....
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....e assessee qua sundry debtors, which is not the case here. In the instant case, the assessee is claiming expenditure against debit notes raised by him against various suppliers, which, in his opinion, have become doubtful and hence allowable. Therefore, the admissibility of impugned expenditure is covered by the provisions of Section 37(1) which reads as follows:- "37.(1) Any expenditure (not being expenditure of the nature described in sections 30 to 36 [***] and not being in the nature of capital expenditure or personal expenses of the assessee), laid out or expended wholly and exclusively for the purposes of the business or profession shall be allowed in computing the income chargeable under the head "Profits and gains of business or pr....
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....ssessee in notes to the account coupled with treatment of the same in the books of accounts and an analysis of other documents placed in the paper book lead us to form an opinion that the impugned expenditure, being mere provisions, did not crystallized during the year and hence not allowable to the assessee. The expenditure to be admissible, at the threshold, must be capable of being classified as an expenditure at the first instance and deduction of mere provisions / estimation could not be allowed to the assessee unless provided by the statute. On the same analogy, the same is not admissible either under Section 28(i). 7. The assessee has placed reliance on the judgment of Hon'ble Supreme Court rendered in Vijaya Bank Vs. CIT [supra] fo....