Delhi Call Centers Pvt. Ltd., New Delhi V. DCIT , Circle-7(1), New Delhi

ITA 3817/DEL/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 0374 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 01-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAGDISH SINGH
• Keywords: Depreciation; Notional interest; Capital Gains
• Section: 13; 28

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B: NEW DELHI (THROUGH VIDEO CONFERENCING) BEFORE, SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO.3817/DEL/2019 (ASSESSMENT YEAR 2012-13) DELHI CALL CENTRE PRIVATE LIMITED 1-10 LAJPAT NAGAR-II NEW DELHI-110 024. PAN AABCD 9233C VS. DY.CIT CIRCLE-7(1), NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY DR. RAKESH GUPTA, ADV. SH. SOMIL AGARWAL, CA RESPONDENT BY SH. JAGDISH SINGH, SR. DR DATE OF HEARING 17.12.2020 DATE OF PRONOUNCEMENT 16.03.2021 ORDER PER SUDHANSHU SRIVASTAVA, JM: THIS APPEAL IS PREFERRED BY THE ASSESSEE AG AINST ORDER DATED 28.02.2019 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-34, NEW DELHI {CIT(A)} FOR ASSESSMENT YEAR 2012-13. 2 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT 2.0 THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY WAS ENGAGED IN THE BUSINESS OF RUNNING A CAL L CENTER IN EARLIER ASSESSMENT YEARS, ALTHOUGH THE ASSESSEE WAS NO LONGER IN OPERATION DURING THE YEAR UNDER CONSIDERATION. THE RETURN OF INCOME WAS FILED DECLARING A LOSS OF RS.47,44,408/- . SUBSEQUENTLY, THE RETURN WAS REVISED DECLARING INCOME AT RS. NIL. THE CASE WAS SELECTED FOR SCRUTINY AND SUBSEQUENTLY, THE ASSESSM ENT WAS COMPLETED AT AN INCOME OF RS.3,17,71,620/- AFTER AL LOWING SET OFF OF BROUGHT FORWARD LOSSES AMOUNTING TO RS.1,03,64,510/- AND AFTER MAKING THE FOLLOWING ADDITIONS AND DISALLOWANCES: (I) DISALLOWANCE OF DEPRECIATION: RS.4,46, 250/- (II) NOTIONAL INTEREST: RS.5,25,000/- (III) WRITE BACK OF SUNDRY CREDITORS: RS.4,37,3 8,637/- (IV) DIFFERENCE IN COMPUTATION OF SHORT TERM CAPITAL LOSS: RS.2 1,70,651/- 2.1 AGGRIEVED, THE ASSESSEE APPROACHED THE LD. FIR ST APPELLATE AUTHORITY, WHO WAS PLEASED TO ADJUDICATE TH E APPEAL OF THE ASSESSEE AS UNDER: 3 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT (I) THE DISALLOWANCE OF DEPRECIATION ON CAR AMOUNT ING TO RS.4,46,250/- WAS UPHELD. (II) THE NOTIONAL INTEREST ADDED TO THE INCOME OF THE ASSESSEE AMOUNTING TO RS.1,20,000/- WAS ALSO CONFIRMED. (III) THE CHALLENGE TO ADDITION PERTAINING TO WR IT BACK OF SUNDRY CREDITOR AMOUNTING TO RS.4,37,38,637/- WAS SUSTAINE D TO THE EXTENT OF RS.2,56,68,848/- AND THE BALANCE ADDITION OF RS. 1,80,69,789/- WAS DELETED. (IV) THE SHORT TERM CAPITAL GAIN WAS CONFIRMED TO THE EXTENT OF RS.2,56,68,648/-. 2.1 AGGRIEVED, THE ASSESSEE IS NOW BEFORE THIS TRI BUNAL CHALLENGING THE ORDER OF THE LD. CIT(A). THE FOLLOWI NG GROUNDS HAVE BEEN RAISED BY THE ASSESSEE IN THIS REGARD: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE THE LEARNED CIT(A) WAS NOT JUSTIFIED IN UPHOLDING T HE DISALLOWANCE OF DEPRECIATION ON CAR AMOUNTING TO RS .4,46,250/- 2. THAT ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE THE LEARNED CIT(A) WAS NOT JUSTIFIED IN SUSTAINING THE DISALLOWANCE OF RS.1,20,000/- ON ACCOUNT OF NOTIONA L INTEREST. 3. THAT THE LEARNED CIT(A) HAS GROSSLY E RRED IN LAW IN REDUCING THE LIABILITY OF UNPAID CREDITOR OF RS.4,3 7,38,637/- FROM 4 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT THE OPENING WDV OF BLOCK OF LICENCE OF RS.1,19,78,7 71/- AND SUSTAINING AN ADDITION OF RS.2,56,68,848/- U/S 50 O F THE ACT. 3.1 THAT THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED THAT THE WRITE BACK OF CREDITOR FOR LICENCE OF RS.4,37,3 8,637/- IN BOOKS WAS NOT TAXABLE UNDER THE PROVISIONS OF THE I NCOME TAX ACT. 3.2 THAT THE LEARNED CIT(A) FAILED TO COMPREH END THAT WRITE BACK OF CREDITOR OF RS.4,37,38,637/- FOR LICENCE AN D SALE OF LICENCE ARE TWO UNRELATED SEPARATE TRANSACTIONS. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE A DDITION OF RS.21,70,651/- BEING THE DIFFERENCE IN THE RETURNED SHORT TERM CAPITAL LOSS OF RS.2,02,40,640/- AND RS.1,80,69,989 /-, THE REVISED SHORT TERM CAPITAL LOSS. 3.0 THE LD. AUTHORIZED REPRESENTATIVE (AR) SUBMITT ED THAT GROUND NO.1 OF THE APPEAL CHALLENGES THE ACTION OF THE LD. CIT(A) IN UPHOLDING THE DISALLOWANCE OF DEPRECIATION ON CAR T O THE EXTENT OF RS.4,46,250/-, ON THE GROUND THAT THE INVOICE OF CA R PURCHASE WAS NOT PRODUCED FOR VERIFICATION. THE LD. AR SUBMITTED THAT ALTHOUGH THE INVOICE COULD NOT BE PRODUCED DUE TO THE REASON OF THE RELEVANT PAPERS HAVING BEEN FILED WITH THE FINANCING BANK, AL L THE SAME THE DEPARTMENT HAD ALLOWED INTEREST ON CAR LOAN AS DEDU CTIBLE EXPENDITURE AND NO DISALLOWANCE HAD BEEN MADE ON ACC OUNT OF CAR 5 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT RUNNING EXPENSES. IT WAS SUBMITTED THAT, ACCORDINGLY , IT WAS APPARENT THAT THE DEPARTMENT HAD ACCEPTED THAT THE CAR HAD BEEN USED FOR THE PURPOSES OF THE BUSINESS OF THE ASSESS EE COMPANY AND, THEREFORE, ALTHOUGH THE INVOICE FOR THE CAR PURCHAS E COULD NOT BE PRODUCED DUE TO THE REASON OF THE SAME BEING IN POS SESSION OF THE FINANCING BANK, NO DISALLOWANCE OF DEPRECIATION COUL D HAVE BEEN MADE. 3.1 IN GROUND NO.2, THE ASSESSEE HAS CHALLENGED TH E ADDITION OF RS.1,20,000/- ON ACCOUNT OF NOTIONAL INTEREST ON LOAN. IT WAS SUBMITTED THAT THE AASSESSEE HAD GIVEN A LOAN OF RS .10,00,000/- TO M/S CHANDER RANI ENTERPRISES LTD. AND NO INTEREST H AD BEEN CHARGED ON THIS LOAN, BUT THE ASSESSING OFFICER HAD MADE A NOTIONAL ADDITION @ 12% ON THIS LOAN. IT WAS SUBMITTED THAT THE ADVANCE/LOAN HAD BEEN GIVEN FOR THE PURPOSES OF BUS INESS OF THE ASSESSEE COMPANY AND, FURTHER, THE ASSESSEE COMPANY HAD SUFFICIENT RESERVES AND SHAREHOLDERS FUNDS TO MAKE THE LOAN AS WOULD BE EVIDENT FROM THE BALANCE OF THE COMPANY. IT WAS SUBMITTED THAT THE ADVANCE HAD NOT BEEN MADE FROM A NY INTEREST BEARING LOAN. RELIANCE WAS PLACED ON NUMEROUS JUDICI AL PRECEDENTS 6 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT FOR THE PROPOSITION THAT IF THE ASSESSEE HAD SUFFIC IENT INTEREST FREE FUND AT ITS DISPOSAL, NO DISALLOWANCE/ADDITION CAN B E MADE TOWARDS NOTIONAL INTEREST ON INTEREST FREE ADVANCE/LOAN. 3.2 WITH RESPECT TO GROUND NO.3, IT WAS SUBM ITTED THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SHOWN LOSS ON SALE OF FIXED ASSETS GROSSING TO RS.5,39,16,901/- AND TH E NET LOSS ON SALE OF ASSETS AT RS.1,01,78,264/-. IT WAS SUBMITTED THA T THE ASSESSING OFFICER HAD REQUIRED THE ASSESSEE TO EXPLAIN WHY THE GROSS LOSS SHOULD NOT BE ADDED BACK TO THE ASSESSEES INCOME A ND IT HAD BEEN SUBMITTED DURING THE COURSE OF ASSESSMENT PROCEEDIN GS THAT IT PERTAINED TO PURCHASE OF LICENSE WHICH WAS SPECIFIC TO THE BUSINESS OF THE ASSESSEE AND SINCE THE ASSESSEE COMPANY HAD STARTED INCURRING LOSSES, THE ASSET VALUE OF THE SAID LICEN SE HAD BECOME REDUNDANT AND THE COMPANY WAS UNABLE TO PAY FOR THE COST OF THE LICENSE TO THE COMPANY IN UNITED KINDOM (UK). IT WAS FURTHER SUBMITTED BEFORE THE ASSESSING OFFICER THAT THE ASS ESSEE COMPANY HAD WRITTEN BACK THE AMOUNT OF CREDITORS AT RS.4,37, 38,637/- WHICH RELATED TO THE PURCHASE OF FIXED ASSETS AND D ID NOT CONSTITUTE INCOME OF THE ASSESSEE. IT WAS FURTHER SUBMITTED TH AT THE PROVISIONS 7 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT OF SECTION 41(1) OF THE INCOME TAX ACT, 1961 (HEREI NAFTER CALLED THE ACT) WOULD NOT APPLY AS IT WAS NOT A TRADING LIABILI TY AND FURTHER THE ASSESSEE HAD NOT CLAIMED ANY DEDUCTION THERE FROM E ITHER IN THIS YEAR OR IN EARLIER YEARS. IT WAS SUBMITTED THAT THE ENTIRE LOSS ON SALE OF FIXED ASSET AMOUNTING TO RS.5,39,16,901/- HAD BE EN ADDED BACK IN THE COMPUTATION OF INCOME BY THE ASSESSEE AS WAS EVIDENT FROM THE COPY OF THE COMPUTATION PLACED IN THE PAPER BOO K. IT WAS FURTHER SUBMITTED THAT WRITE BACK OF LIABILITY OF RS .4,37,38,637/- BEING LIABILITY IN RESPECT OF FIXED ASSETS WAS NOT T AXABLE AND ONLY THE NET SUM OF RS.1,01,78,264/- HAS BEEN ADDED BACK. IT WAS FURTHER SUBMITTED THAT BOTH THE LOSS ON SALE OF FIXED ASSET S AS WELL AS WRITE BACK OF CREDITORS HAS BEEN DULY REFLECTED IN SCHEDU LE 17 OF THE ANNUAL ACCOUNTS. THE LD. AR ALSO SUBMITTED THAT WHAT IS THE TAXABLE UNDER THE INCOME TAX ACT IS ONLY REVENUE RE CEIPTS AND THAT RECEIPTS OF CAPITAL NATURE ARE NOT TAXED UNDER THE SCHEME OF THE ACT. RELIANCE WAS PLACED ON NUMEROUS CASE LAWS ON THIS ISS UE ALSO. THE LD. AR ALSO SUBMITTED THAT PROVISIONS OF SECTION 50 (1) & (2) OF THE ACT WERE NOT APPLICABLE IN THIS CASE AND, THEREFORE , BOTH THE LOWER AUTHORITIES WERE INCORRECT IN INVOKING THE PROVISIO NS IN THIS REGARD. 8 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT 3.3 WITH RESPECT TO GROUND NO.4, THE LD. AR SUBMI TTED THAT THIS GROUND CHALLENGED THE ACTION OF THE LD. C IT(A) IN UPHOLDING THE ADDITION OF RS.21,70,651/- BEING THE DIFFERENCE IN RETURNED SHORT TERM CAPITAL LOSS OF RS.2,02,40,640/ - AND RS.1,80,69,989/- I.E., REVISED SHORT TERM CAPITAL L OSS. IT WAS SUBMITTED THAT IN EFFECT THE ASSESSEE HAD NOT BEEN ALLOWED THE BENEFIT OF SET OFF OF BROUGHT FORWARD LOSS. 4.0 PER CONTRA, THE LD. SR. DEPARTMENTAL REPRE SENTATIVE (DR) PLACED RELIANCE ON THE CONCURRENT FINDINGS OF BOTH THE LOWER AUTHORITIES AND VEHEMENTLY ARGUED THAT THE DISALLOWANCES/ADDITIONS HAD BEEN RIGHTLY MADE. 5.0 WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALSO PERUSED THE MATERIAL ON RECORD. 5.1 AS FAR AS GROUND NO.1 REGARDING DISALLOWANCE ON DEPRECIATION IS CONCERNED, THE ONLY OBJECTION TO TH E ALLOWANCE OF DEPRECIATION BY THE LOWER AUTHORITIES IS THAT THE A SSESSEE COULD NOT PRODUCE COPY OF PURCHASE INVOICE OF THE VEHICLE. IT IS UNDISPUTED 9 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT THAT THE DEPARTMENT HAS ALLOWED INTEREST ON VEHICLE LOAN AS WELL AS HAS ALSO ALLOWED THE EXPENDITURE TOWARDS CAR RUNNING . THUS, IN FACT, IT IS ACCEPTED BY THE DEPARTMENT THAT THE ASS ESSEE HAS A VEHICLE WHICH IS USED FOR THE BUSINESS PURPOSES. ALT HOUGH, THE ASSESSEE COULD HAVE MADE EFFORTS TO OBTAIN A COPY O F THE PURCHASE INVOICE FROM THE HYPOTHECATING BANK AND PRODUCED IT BEFORE THE LOWER AUTHORITIES, ALL THE SAME, IT IS OUR CONSIDER ED OPINION THAT THE ASSESSEE SHOULD NOT BE PENALIZED FOR HIS FAILUR E TO PRODUCE THE PURCHASE INVOICE, SPECIALLY, WHEN THE DEPARTMENT HAS IN PRINCIPLE ACCEPTED THE ASSESSEES CLAIM OF INTEREST ON CAR LO AN AS WELL AS CLAIM OF CAR RUNNING EXPENDITURE. THEREFORE, IN VIE W OF THE FACTS OF THE CASE, WE DELETE THIS DISALLOWANCE. 5.2 AS FAR AS GROUND NO.2 IS CONCERNED, I T CHALLENGES THE ADDITION ON ACCOUNT OF NOTIONAL INTEREST ADDED TO T HE INCOME OF THE ASSESSEE IN RESPECT OF AN AMOUNT OF RS.10,00,000/- ADVANCED TO M/S CHANDER RANI ENTERPRISES PVT. LTD.. WE HAVE GO NE THROUGH THE AUDITED FINANCIAL STATEMENTS OF THE ASSESSEE AND IT IS SEEN THAT THE SHARE HOLDERS FUNDS (SHARE CAPITAL AND RESERVES & SURPLUS) AS ON 10 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT 31 ST MARCH, 2012 STOOD AT RS.4,88,60,427/- WHEREAS THE L ONG TERM BORROWING STOOD ONLY AT RS.11,84,274/- AND THE SHORT TERM BORROWING STOOD AT RS.4,05,944/-. THUS, IT CAN BE SA FELY CONCLUDED THAT THE ADVANCE OF RS.10,00,000/- GIVEN BY THE ASS ESSEE WAS GIVEN FROM INTEREST FREE FUNDS/RESERVES OF THE ASSESSEE. IN SUCH A SITUATION, WE ARE UNABLE TO UPHOLD THE ADDITION ON ACCOUNT OF NOTIONAL INTEREST TO THE INCOME OF THE ASSESSEE AND WE DIRECT THE DELETION OF THE SAME. 5.3 AS FAR AS THE GROUND NO.3 OF THE APPE AL IS CONCERNED, THE SAME CHALLENGES THE ACTION OF THE LD. CIT(A) IN REDUCING THE LIABILITY OF UNPAID CREDITORS OF RS.4,37,38,637/- F ROM THE OPENING WRITTEN DOWN VALUE OF BLOCK OF LICENSE OF RS.1,19,78 ,771/- AND SUSTAINING AN ADDITION OF RS.2,56,68,848/- U/S 50 O F THE ACT. THE FACTS LEADING TO THIS CONTROVERSY ARE THAT DURING T HE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SHOWN LOSS ON SALE O F FIXED ASSETS GROSSING TO RS.5,39,16,901/- AND THE NET LOSS ON SA LE OF ASSETS AT RS.1,01,78,264/-. THE ASSESSING OFFICER HAD REQUIRE D THE ASSESSEE TO EXPLAIN WHY THE GROSS LOSS SHOULD NOT BE ADDED BA CK TO THE 11 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT ASSESSEES INCOME AND IT HAD BEEN SUBMITTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT IT PERTAINED TO PURCHAS E OF LICENSE WHICH WAS SPECIFIC TO THE BUSINESS OF THE ASSESSEE AN D SINCE THE ASSESSEE COMPANY HAD STARTED INCURRING LOSSES, THE ASSET VALUE OF THE SAID LICENSE HAD BECOME REDUNDANT AND THE COMPA NY WAS UNABLE TO PAY FOR THE COST OF THE LICENSE TO THE CO MPANY IN UNITED KINDOM (UK). IT WAS FURTHER SUBMITTED BEFORE THE ASS ESSING OFFICER THAT THE ASSESSEE COMPANY HAD WRITTEN BACK THE AMOUN T OF CREDITORS AT RS.4,37,38,637/- WHICH RELATED TO THE PURCHASE OF FIXED ASSETS AND THE SAME DID NOT CONSTITUTE INCOME OF THE ASSESSEE. IT HAS BEEN ARGUED THAT THE PROVISIONS OF SECTION 4 1(1) OF THE ACT WOULD NOT APPLY AS IT IS NOT A TRADING LIABILITY AND FURTHER THE ASSESSEE HAS NOT CLAIMED ANY DEDUCTION THEREFROM EI THER IN THIS YEAR OR IN EARLIER YEARS. IT HAS BEEN SUBMITTED THA T THE ENTIRE LOSS ON SALE OF FIXED ASSETS AMOUNTING TO RS.5,39,16,901 /- HAS BEEN DULY REFLECTED IN THE AUDITED FINANCIAL STATEMENTS (SCHEDULE 17) AND THAT WRITE BACK OF LIABILITY OF RS.4,37,38,637/-, BE ING LIABILITY IN RESPECT OF FIXED ASSETS WAS DEDUCTED THEREFROM AND ONLY THE NET SUM OF RS.1,01,78,264/- HAS BEEN ADDED BACK IN THE COMPUTATION. 12 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT AS FAR AS THE CONTENTION OF THE ASSESSEE REGARDING NON-APPLICABILITY OF SECTION 41(1) OF THE ACT IS CONCERNED, WE ARE IN FULL AGREEMENT WITH THE SAME. THE HONBLE APEX COURT IN THE CASE OF CIT VS. MAHINDRA AND MAHINDRA LTD. REPORTED IN [2018] 404 I TR 01 (SC) HAS LAID DOWN THAT WAIVER ON LOAN AMOUNTS TO CESSATIO N OF LIABILITY OTHER THAN THE TRADING LIABILITY AND IT IS NEITHER TAXABLE AS PERQUISITE U/S 28 (IV) OF THE ACT NOR TAXABLE AS A REMISSION O F LIABILITY U/S 41(1) OF THE ACT. ON SIMILAR REASONING THE WRITE BACK OF S UNDRY CREDITORS PERTAINING TO PURCHASE OF ASSETS WOULD NOT CONSTITU TE INCOME OF THE ASSESSEE. WE HAVE ALSO GONE THROUGH NOTE NO.17 IN N OTES TO THE FINANCIAL STATEMENTS AND IT IS SEEN THAT IN THE AUD ITED FINANCIAL STATEMENTS, THE ASSESSEE HAS DECLARED LOSS ON SALE OF FIXED ASSETS OF RS.5,39,16,901/- AND HAS, THEREAFTER, DEDUCTED THE UNPAID CREDITORS FOR LICENSE AMOUNTING TO RS.4,37,38,637/- AND HAS THUS DECLARED A NET LOSS OF RS.1,01,78,264/- ONLY. IT IS THIS, AMOUNT OF RS.1,01,78,264/- WHICH HAS BEEN REFLECTED IN THE COM PUTATION OF INCOME FILED BY THE ASSESSEE. THIS, IN OUR CONSIDER ED OPINION, IS NOT CORRECT. THE FACT REMAINS THAT THE ASSESSEE HAS FIN ALLY PAID AN AMOUNT WHICH IS MUCH LESS THAN THE AGREED/ INVOICED AMOUNT 13 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT TOWARDS THE PURCHASE OF FIXED ASSETS. THE AMOUNT LES S PAID IS RS.4,37,38,637/-. THUS, IN FACT, THE ACTUAL COST OF THE FIXED ASSETS TO THE ASSESSEE HAS BEEN REDUCED BY RS.4,37,38,637/ - AND TO THIS EXTENT THE STAND OF THE DEPARTMENT IS CORRECT THAT THE ASSESSEE SHOULD HAVE REDUCED THE COST OF ASSETS BY THE AMOUN T OF RS.4,37,38,637/-. FURTHER, WE ARE IN AGREEMENT WITH T HE CONTENTION OF THE LD. AUTHORIZED REPRESENTATIVE THAT PROVISION S OF SECTION 50 (1) & (2) OF THE ACT ARE NOT ATTRACTED IN THIS CASE . AS THERE HAS BEEN NO TRANSFER OF ASSETS IN THE PRESENT CASE, SHORT TE RM CAPITAL GAINS CANNOT BE COMPUTED IN THIS CASE. ACCORDINGLY, THIS ISSUE WILL HAVE TO BE RE-EXAMINED BY THE ASSESSING OFFICER AFTER DU LY TAKING INTO ACCOUNT OUR DIRECTIONS THAT PROVISIONS OF SECTION 4 1(1) AND SECTION 50(1) & 50(2) ARE NOT ATTRACTED IN THIS CASE. HOWEV ER, THE AMOUNT OF SUNDRY CREDITORS WRITTEN BACK I.E. RS.4,37,38,637/- WILL HAVE TO BE REDUCED FROM THE COST OF FIXED ASSETS AND WRITTEN D OWN VALUE WOULD HAVE TO BE ADJUSTED ACCORDINGLY. THUS, GROUND NOS.3, 3.1 & 3.2 HAVE TO BE RECONSIDERED AND REEXAMINED BY THE A SSESSING OFFICER. WE DIRECT THAT THE SAME BE DONE AFTER GIVI NG ADEQUATE OPPORTUNITY TO THE ASSESSEE TO PRESENT ITS CASE. 14 ITA NO.3817/DEL/2019 DELHI CALL CENTRE PVT. LTD. VS. DCIT 5.4 SINCE, GROUND NO.4 IS RELATED TO GROUND NO.3 OF THE ASSESSEE APPEAL, THE SAME IS ALSO RESTORED TO THE F ILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECT ED TO ALLOW SET OFF OF BROUGHT FORWARD LOSSES AS PER LAW THEREAFTER. 6.0 IN THE FINAL RESULT, THE APPEAL OF THE A SSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 16 TH MARCH, 2021. [ SD/- SD/- (ANIL CHATURVEDI) (SUDHANSHU SRIVASTAVA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 16/03/2021 PK/PS COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI