TaxTMI 
TaxTMI 
2015 (9) TMI 1695
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.... of interest u/s.234B which is consequential in nature. Ground.5 which raises a grievance regarding rejection of tax credit u/s.115JAA of the Income-tax Act, 1961 ('the Act' in short) was not argued by the Ld. AR. This leaves us with grounds 3 and 4. 02. Assessee in its ground 3 is aggrieved that CIT (A) confirmed the disallowance of bad debts write -off of Rs. 4,86,14,074/-. Ld. Counsel for the assessee submitted that lower authorities did not consider the judgment of Hon'ble Apex Court in the case of T. R. F. Ltd v. CIT [(2010) 323 ITR 397] ; CIT v. Amalgamations P. Ltd [(1997) (226 ITR 188)] and that of Delhi Third Member decision of this Tribunal in the case of Poysha Oxygen (P) Ltd v. ACIT [(2008) (19 SOT 711). As per the Ld. AR, amou....
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....ghly doubtful, it was only prudent for the assessee not to charge interest, and this could not be cited as a reason for disallowing the claim of bad debt. Reliance was placed on decision of coordinate bench in the case of Ceat Ltd v. DCIT [(2009) 24 DTR 445]. Thus according to him, lower authorities fell in error in disallowing the claim of bad debts. 03. Ld. DR strongly supporting the order of lower authorities, submitted that loans given to PIE Education P. Ltd was not a part of assessee's business. There was no charge of interest on such loans. Just because assessee had accounted interest received on loans given by it, as a part of its business income, would not make the assessee eligible for claiming a bad debt write off. 04. We have ....
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....owing provisions shall apply- (i) no such deduction shall be allowed unless such debt or part thereof has been taken into account in computing the income of the assessee of the previous year in which the amount of such debt or part thereof is written off or of an earlier previous year, or represents money lent in the ordinary course of the business of banking or money-lending which is carried on by the assessee ; 07. When assessee itself had not charged any interest on the amount advanced, it cannot say that any income from such loans were taken into account for computing its total income. For the simple reason that assessee had never charged any interest on the loan to PIE Education P. Ltd, such loan cannot be treated as money lent by t....
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....ribunal in the case of Ceat Ltd (supra), interest was due to the concerned assessee in terms of a contractual agreement, and the assessee had not charged interest on such loans despite terms of contract providing for it. In the case before us admittedly there was no contractual agreement between the assessee and PIE Education P. Ltd for charging of any interest. 12. In the case of B. N. Khandelwal v. ITO [2007) 16 SOT 343], relied on by the Ld. AR, no doubt it was held that absence of money lending license was not a crucial factor for deciding on the nature of the business activity undertaken by an assessee. In the case before us assessee has not been able to demonstrate that the money lent by it to PIE Education P. Ltd was in the course o....