ZING ENTERPRISES, MUMBAI V. ITO 19(3)(3), MUMBAI

ITA 5206/MUM/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7999 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 18-08-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 17-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K NAYAK
• Assessee Lawyers: S M BANDI
• Keywords: Bad and doubtful debts

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI . . , . . , ! '# $ BEFORE SHRI H.L.KARWA, PRESIDENT AND SHRI N.K.BILLA IYA, AM ./ I.T.A. NO. 5206/MUM/2012 ( %& ' / ASSESSMENT YEAR: 2007-08) M/S ZING ENTERPRISES, SHRI MADHAV G. PATANKAR, PARTNER OF M/S ZING ENTERPRISES, C/O- RASHMI U.THACKERAY, 401/402, DALLAS APARTMENT, KALA NAGAR, BANDRA(EAST), MUMBAI-400051 & / VS. THE ITO, WARD-19(3)(3), MUMBAI. ./ PAN : AAAEZ0364Q ( / APPELLANT) .. ( ! / RESPONDENT ) ' # / ASSESSEE BY: SHRI S.M.BANDI ! ' # / RESPONDENT BY : SHRI A.K.NAYAK $ % ' &' / DATE OF HEARING : 18/08/2014 ()*+ ' &' / DATE OF PRONOUNCEMENT : 18/08/2014 ,- / O R D E R PER N.K.BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAI NST THE ORDER OF THE CIT(A)-30 MUMBAI DATED 28/05/2012 PERTAINING TO ASS ESSMENT YEAR 2007-08. 2. THE FIRST GROUND OF APPEAL RELATES TO THE ADDITI ON OF ` .21,00,000/-ON ACCOUNT OF BAD DEBTS WRITTEN OFF. D URING THE COURSE OF THE SCRUTINY ASSESSMENT PROCEEDINGS, THE AO FOUN D THAT THE ASSESSEE HAS WRITTEN OFF ` .21LAKHS AS BAD DEBTS. THE ASSESSEE WAS ITA NO.5206/MUM/2012 2 ASKED TO JUSTIFY ITS CLAIM. THE ASSESSEE FILED A D ETAILED REPLY STATING THAT THE AMOUNT WAS GIVEN AS LOAN ON WHICH INTEREST WAS CHARGED, THE INTEREST RECEIVED WAS SHOWN AS INCOME UNDER THE HEAD PROFIT AND GAINS OF BUSINESS. THE AO DISALLOWED THE CLAIM OF THE ASSESSEE BY STATING THAT THE ASSESSEE ITSELF HAS AGREED FOR THE ADDITION. 3. ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). IT WAS STRONGLY CONTENDED THAT THE LETTER REFERRED BY THE AO DATED 30/11/2009, NOWHERE STATED THAT THE ASSESSEE HAS AGREED FOR ADD ITION. THE LD. CIT(A) WAS CONVINCED THAT THE LETTER DOES NOT INDIC ATE THAT THE AMOUNT OF ` .21 LAKHS WAS OFFERED FOR TAXATION, THOUGH THE CIT( A) AGREED UPON THE OTHER CONTENTS OF THE LETTER AND CO NFIRMED THE DISALLOWANCE MADE BY THE AO. 4. AGGRIEVED BY THIS, THE ASSESSEE IS BEFORE US. 5. THE COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES. THE DR SIMPLY SUPPOR TED THE FINDINGS OF THE LOWER AUTHORITIES. 6. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTH ORITIES BELOW. THE AO HAS PROCEEDED ONLY ON THE BASIS OF THE LETTE R OF THE COUNSEL WITHOUT GOING INTO THE MERITS OF THE CASE AND THE S UBMISSIONS OF THE ASSESSEE. IN OUR CONSIDERED OPINION, THIS ISSUE NE EDS TO BE DECIDED AFRESH ON THE MERIT OF THE CASE. WE THEREFORE REST ORE THIS ISSUE TO THE FILES OF THE AO. THE AO IS DIRECTED TO VERIFY WHET HER THE ASSESSEE HAS BEEN SHOWING INTEREST INCOME FROM THE LOANS GIVEN I N EARLIER YEAR AND WRITTEN OFF DURING THE YEAR UNDER CONSIDERATION . THE AO IS ALSO DIRECTED TO VERIFY WHETHER THE SAID INTEREST HAS BE EN SHOWN UNDER THE HEAD PROFIT AND GAINS OF THE BUSINESS AND THE N DECIDE THE ISSUE AFRESH AS PER THE PROVISIONS OF THE LAW. ITA NO.5206/MUM/2012 3 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18/08/201 4 ,- ' ()*+ $ . / 0 1, 18 /08/2014 , ) ' 2% 3 SD/- (H.L.KARWA) SD/- (N.K.BILLAIYA) HONBLE PRESIDENT ACCOUNTANT MEMBER / $ % MUMBAI; 1, /DATED : 18 TH AUGUST, 2014. F{X~{TA F{X~{TA F{X~{TA F{X~{TA P.S. P.S. P.S. P.S. ' ( ) *%+,- . -'+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. ! / THE RESPONDENT. 3. $ 4& ( ) / THE CIT- , MUMBAI. 4. $ 4& / CIT(A)- , MUMBAI 5. 562 7&789 , ' 89+ , / $ % / DR, ITAT, MUMBAI 6. 2: ;% / GUARD FILE. ' (& / BY ORDER, ! 5& 7& //TRUE COPY// / / 0 1 (DY./ASSTT. REGISTRAR) , / $ % / ITAT, MUMBAI