The DCIT, 1(1), Bhopal V. M/s. BEND JOINTS PVT. LTD., Bhopal

ITA 324/IND/2014

• Counselvise Citation: 32422714 RSA 2014
• Duration Of Justice: 1 year(s) 6 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-12-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 02-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA

Judgement Text

DCIT VS. M/S BEND JOINTS PVT LTD ITA NO. 324/IND/2014 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER AND SHRI B.C. MEENA, HONBLE ACCOUNTANT MEMBER ITA NO. 324/IND/2014 A.Y.2009-10 DY. COMMR. OF INCOME TAX 1(1) BHOPAL ::: APPELLANT VS M/S BEND JOINTS PVT. LTD. BHOPAL ::: RESPONDENT APPELLANT BY SHRI R.A. VERMA RESPONDENT BY NONE DATE OF HEARING 6.10.2015 DATE OF PRONOUNCEMENT 1 . 1 2 .2015 O R D E R PER SHRI B.C. MEENA, AM THIS APPEAL FILED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LEARNED CIT(A)-I, BHOPAL, DATED 25.2. 2014. DCIT VS. M/S BEND JOINTS PVT LTD ITA NO. 324/IND/2014 2 2. NONE ATTENDED ON BEHALF OF THE ASSESSEE. THE LEARNED DR WAS HEARD. 3. THERE IS ONLY ONE GROUND IN THE APPEAL AGAINST DELET ION OF ADDITION OF RS.19,16,152/- ON ACCOUNT OF BALANCE O F UNSECURED LOANS WHEN THE APPELLANTS CLAIM OF BROUGHT FORWARD UNSECURED LOANS WHICH REPRESENT CESSATION OF LIABILITY CLEARLY AMOUNTS TO VIOLATION OF THE PROVISION S OF SECTION 41(1) OF THE ACT. 4. THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN THE BUSINESS OF SUPPLY OF FABRICATED SHEDS AND PREFABRICATED OTHER ITEMS. THE RETURN OF INCOME WAS FI LED ON 30.9.2009 DECLARING INCOME AT RS.37,07,610/-. THE ASSESSING OFFICER INVOKED THE PROVISIONS OF SECTION 41(1) OF THE ACT WITH REGARD TO 11 CREDITORS FROM WHOM UNSECU RED LOAN WAS RECEIVED TOTALING TO RS.19,16,152/-. THE LEARN ED DCIT VS. M/S BEND JOINTS PVT LTD ITA NO. 324/IND/2014 3 CIT(A) DELETED THE ADDITION BY HOLDING THAT THE PROVI SIONS OF SECTION 41(1) OF THE ACT ARE ATTRACTED ONLY WHERE AN ALLOWANCE OR DEDUCTION HAS BEEN ALLOWED IN THE ASSESSMEN T FOR ANY YEAR IN RESPECT OF ANY LOSS, EXPENDITURE OR T RADING LIABILITY INCURRED BY THE ASSESSEE AND SUBSEQUENTLY DUR ING ANY PREVIOUS YEAR ANY AMOUNT IS RECEIVED IN RESPECT OF SUCH LOSS OR EXPENDITURE OR SOME BENEFIT HAS BEEN OB TAINED IN RESPECT OF SUCH TRADING LIABILITY BY WAY OF REMISS ION OR CESSATION THEN ONLY THE AMOUNT SHALL BE DEEMED TO BE PROFIT AND GAINS OF THE BUSINESS. IN THIS CASE THE ASSE SSEE HAS OBTAINED UNSECURED LOANS FROM VARIOUS PERSONS AND SHOWN AS LIABILITY IN THE BALANCE SHEET. THESE UNSECU RED LOANS TAKEN BY THE ASSESSEE WERE NEVER CLAIMED OR ALLOW ED AS EXPENSE OR DEDUCTION OR LOSS IN COMPUTATION OF BUS INESS INCOME IN ANY EARLIER ASSESSMENT YEAR. THE REVENUE HAS FAILED TO CONTRADICT THIS FINDING OF THE LEARNED CIT(A ). WE, DCIT VS. M/S BEND JOINTS PVT LTD ITA NO. 324/IND/2014 4 THEREFORE, FIND NO MERIT IN THIS APPEAL OF THE REVENU E AND DISMISS THE SAME. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMIS SED. PRONOUNCED IN OPEN COURT ON IST DECEMBER, 2015 SD/- SD/- (D.T. GARASIA) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER IST DECEMBER, 2015 DN/-