Dy. Commissioner of Income Tax-17(1),Mumbai, MUMBAI V. JASVANTLAL GIRDHARLAL SHAH , MUMBAI

ITA 3215/MUM/2023

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 7496 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 23-04-2024
• Assessment Year: 2014-2015
• Appeal Filed On: 10-09-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESHWARI MENON
• Assessee Lawyers: SANJAY SHAH
• Keywords: Bad and doubtful debts; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “F” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI RAHUL CHAUDHARY (JUDICIAL MEMBER) ITA No. 3215/MUM/2023 Assessment Year: 2014-15 DCIT-17(1), Room No. 117, 1 st floor, G-Block, Kautilya Bhavan, Bandra Kurla Complex, Mumbai-400051. Vs. Jasvantlal Girdharlal Shah, Office No. 1109 P.J. Tower, Dalal Street, Fort, Mumbai-400 001. PAN NO. AAQPS 0732 B Appellant Respondent Assessee by : Mr. Sanjay Shah Revenue by : Ms. Rajeshwari Menon, Sr. DR Date of Hearing : 24/04/2024 Date of pronouncement : 30/04/2024 ORDER PER OM PRAKASH KANT, AM This appeal by the Revenue is directed against order dated 11.07.2023 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, New Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2014-15, raising following grounds: 1. "Whether, on the facts and in circumstance of the case and in law, the Ld. CIT (A) has erred in deleting the on account of bad debts without appreciating the fact that the cost of stock not received cannot be treated as bad debts in view of the fact that the matter is still under investigation by Economic Offences Wing. " 2. "Whether, on the facts and in circumstance of the case and in law, the Ld. CIT (A) has failed to consider the fact that the bad debts written off were not offered to tax either in the year under consideration or earlier years, and hence the conditions laid down in section 36(2) of the Income Tax Act, 1961 are not satisfied. 2. At the outset, the Ld. counsel for the assessee submitted that tax effect involved in the appeal preferred by the Revenue is below the threshold limit of Rs.50,00,000/ Board of Direct Taxes (CBDT) for filing appeal before the Income Appellate Tribunal (ITAT) as specified in 3/2018 dt. 20/08/2018 3. The Ld. Counsel payable computed by the Assessing Officer. We find that total tax payable on the assessed income by way of impugned assessment order is only Rs.49,13,305/ the returned income and therefore, evidently, the tax effect involved in the issue in dispute is below the threshold limit of Rs.50,00,000/- prescribed by the Circular No appeal before the Tribunal. 4. The Ld. Departmental Representative (DR) also could controvert the tax computation presented by the Ld. counsel for the assessee. In the circumstances, Jasvantlal Girdharlal Shah 1. "Whether, on the facts and in circumstance of the case and in law, the Ld. CIT (A) has erred in deleting the addition of Rs. 1,67,85,221/ on account of bad debts without appreciating the fact that the cost of stock not received cannot be treated as bad debts in view of the fact that the matter is still under investigation by Economic Offences Wing. , on the facts and in circumstance of the case and in law, the Ld. CIT (A) has failed to consider the fact that the bad debts written off were not offered to tax either in the year under consideration or earlier years, and hence the conditions laid down in section 36(2) of the Income Tax Act, 1961 are not satisfied. At the outset, the Ld. counsel for the assessee submitted that tax effect involved in the appeal preferred by the Revenue is below the threshold limit of Rs.50,00,000/- prescribed by the Cent Board of Direct Taxes (CBDT) for filing appeal before the Income Appellate Tribunal (ITAT) as specified in (CBDT), Circular No. 3/2018 dt. 20/08/2018 Counsel has filed a detailed calculation of the tax payable computed by the Assessing Officer. We find that total tax payable on the assessed income by way of impugned assessment order is only Rs.49,13,305/- which also include the tax payable on me and therefore, evidently, the tax effect involved in the issue in dispute is below the threshold limit of prescribed by the Circular No. 3/2018 appeal before the Tribunal. The Ld. Departmental Representative (DR) also could controvert the tax computation presented by the Ld. counsel for the assessee. In the circumstances, we are of the opinion that this Jasvantlal Girdharlal Shah 2 ITA No. 3215/MUM/2023 1. "Whether, on the facts and in circumstance of the case and in law, addition of Rs. 1,67,85,221/- on account of bad debts without appreciating the fact that the cost of stock not received cannot be treated as bad debts in view of the fact that the matter is still under investigation by Economic Offences Wing. , on the facts and in circumstance of the case and in law, the Ld. CIT (A) has failed to consider the fact that the bad debts written off were not offered to tax either in the year under consideration or earlier years, and hence the conditions laid down in At the outset, the Ld. counsel for the assessee submitted that tax effect involved in the appeal preferred by the Revenue is below prescribed by the Central Board of Direct Taxes (CBDT) for filing appeal before the Income-tax (CBDT), Circular No. has filed a detailed calculation of the tax payable computed by the Assessing Officer. We find that total tax payable on the assessed income by way of impugned assessment which also include the tax payable on me and therefore, evidently, the tax effect involved in the issue in dispute is below the threshold limit of 3/2018 for filing The Ld. Departmental Representative (DR) also could not controvert the tax computation presented by the Ld. counsel for the e are of the opinion that this appeal filed by the Revenue the CBDT Circular and therefore, same is dismissed a 5. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open Court on Sd/- (RAHUL CHAUDHARY JUDICIAL MEMBER Mumbai; Dated: 30/04/2024 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Jasvantlal Girdharlal Shah appeal filed by the Revenue was not required to be filed following the CBDT Circular and therefore, same is dismissed a In the result, the appeal of the Revenue is dismissed. nounced in the open Court on 30/04/2024. - (RAHUL CHAUDHARY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Jasvantlal Girdharlal Shah 3 ITA No. 3215/MUM/2023 not required to be filed following the CBDT Circular and therefore, same is dismissed as infructuous. In the result, the appeal of the Revenue is dismissed. /04/2024. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai