2018 (5) TMI 1607

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....iled his return of income on 22/03/2010, declaring income of Rs. 8,18,802/-. The assessee carries on business in the name and style of M/s. Pioneer Power Products, which is engaged in the trading of electrical goods. During the assessment proceedings, the Assessing Officer observed that the assessee had an undisclosed HDFC Savings Bank Account No. 00081000062930. He made an addition of Rs. 12,70,000/- being deposit made in cash and an amount of Rs. 7,92,298/-, being amount deposited through cheque or by way of transfer of funds, on the ground that the sources for making these deposits were not explained by the assessee. Further undisclosed interest income of Rs. 3193.44/- was added. The assessee claimed deduction for provision for doubtful....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....lidas Ghosh vs. Income Tax Officer, in ITA No. 2053/Kol/2016, Assessment Year 2007-08, order dt. 28th April, 2017, for the proposition that the closing balance as accepted by the authorities for the Assessment Year 2007-08, is available for explaining the source of deposits for the Assessment Year 2008-09. She pointed out that though the Settlement Commission had not accepted the settlement application filed by the assessee in the Assessment Year 2005-06 to the Assessment Year 2009-10, by separate orders at different points of time, application for the Assessment Year 2010-11 and 2011-12 was accepted and for the earlier years the Assessing Officer in his assessment order passed u/s 143(3) of the Act, has not disturbed the closing cash balan....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....count in question. On the issue of liability of provision for bad debts, he submitted that there was no write off of the bad debts in the books of accounts and hence the Assessing Officer as well as the ld. CIT(A) were right in this regard. He relied on the order of the ld. CIT(A) and prayed that the same be upheld. 6. Rival contentions heard. After perusing the papers on record, orders of the authorities below as well as the case-law cited, I hold as follows:- The assessee submitted a copy of the assessment order passed by the Assessing Officer for the Assessment Year 2008-09. This was passed u/s 147 r.w.s. 143(3) of the Act on 29/03/2017. The balance sheet of the assessee has been recast by including income disclosed while filing an app....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....n my opinion the submission of the ld. Counsel for the assessee has force. Hence I accept the same and consider that the source of funds for deposits aggregating to Rs. 20,62,298/-, made during the year, as explained by the opening cash balance of the year. While doing so, I find similarity in facts between the case of the assessee and the case of Shri Kalidash Ghosh (supra) and apply the proposition of law laid down therein. 6.1. In the result, this addition of Rs. 20,62,298/-, made u/s 68 of the Act is deleted. 7. The second issue is the provision for bad debts. 7.1. The assesse submits that thought the terminology used is "provision for doubtful debts", but in fact it is, "write off of a debt". The facts are that the assessee has sold....