M/s D.K.Industries, Kolkata V. I.T.O Wd - 34(3),kolkata, Kolkata

ITA 683/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5084 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 01-04-2013
• Court: TRIBUNAL
• Department Lawyers: RAJENDRA PRASAD
• Assessee Lawyers: S K TULSIYAN FCA LD
• Keywords: Unexplained cash credit; Rejection of books of accounts; Bad and doubtful debts
• Section: 143(3); 131; 68; 28

Judgement Text

ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 1 IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH, K OLKATA BEFORE : SHRI N.V. VASUDEVAN, JUDICIAL MEMBER, AND SHRI M. BALAGANESH, ACCOUNTAN T MEMBER ITA NO. 683/KOL/2013 A.Y 2009-10 M/S. D.K. INDUSTRIES VS. I.T.O WARD 34(3), KOLKAT A PAN: AABFD 9250E (APPELLANT) (RESPONDENT) FOR THE APPELLANT/ASSESSEE: SHRI S.K . TULSIYAN, FCA, LD. AR FOR THE RESPONDENT/DEPARTMENT: S HRI RAJENDRA PRASAD, JCIT, LD.SR.DR DATE OF HEARING: 05-04-2016 DATE OF PRONOUNCEMENT: 8-4-201 6 ORDER SHRI M.BALAGANESH, AM THIS APPEAL OF THE ASSESSEE ARISES OUT OF THE ORD ER OF THE LEARNED CIT(A)-XX, KOLKATA IN APPEAL NO. 280/CIT(A)-XX/WD-34(3)/11-12 /KOL DATED 17-12-2012 AGAINST THE ORDER OF ASSESSMENT FRAMED FOR THE ASSESSMENT Y EAR 2009-10 U/S. 143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS TH E ACT). 2. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER A SUM OF RS. 36,50,036/- RECEIVED BY THE ASSESSEE COULD BE ADDED AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE BRIEF FACTS OF THIS ISSUE IS THAT THE ASSESSEE IS DEALING IN TRADING OF COTTON. THE LEARNED AO OBSERVED THAT THERE WERE CASH DEPOSITS I NTO THE BANK ACCOUNT OF THE ASSESSEE TO THE TUNE OF RS. 42,30,036/- ON VARIOUS DATES. WHEN CONFRONTED BY THE LEARNED AO, THE ASSESSEE REPLIED THAT RS. 5,80,000/ - WAS DEPOSITED OUT OF CASH IN HAND WHICH WAS ACCEPTED BY THE LEARNED AO. FOR BALANCE SUM OF RS. 36,50,036/- , THE ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 2 ASSESSEE REPLIED THAT ONE OF THE BUSINESSES OF ASSE SSEE FIRM IS MONEY LENDING AND DURING THE COURSE OF MONEY LENDING BUSINESS, IT HAD ADVANC ED MONIES TO THE THREE PARTIES AND THE SAID BALANCES WERE OUTSTANDING FOR MORE THAN 10 YEARS. DURING THE ASSESSMENT YEAR UNDER APPEAL, AFTER LOT OF CONTINUED EFFORTS FROM T HE ASSESSEE, THE FOLLOWING THREE PARTIES DIRECTLY DEPOSITED CASH INTO THE BANK ACCOUNT OF TH E ASSESSEE TOWARDS REPAYMENT OF THEIR RESPECTIVE LOAN DUES :- ( FIGURE IN RS.) M/S RAJ ENTERPRISES 5,89,959 M/S BRAND ALLOYS LTD 22,53,810 MR.VINAY BAID 8,06,267 ------------------ 36,50,036/- OUT OF THE THREE PARTIES, THE ASSESSEE WAS ABLE TO PRODUCE CONFIRMATION LETTER FROM MR.VINAY BAID TOGETHER WITH HIS PAN DETAILS. WITH REGARD TO THE OTHER TWO PARTIES, THE ASSESSEE PROVIDED THE LAST KNOWN ADDRESS AVAILABLE WITH THE ASSESSEE TO THE LEARNED AO FOR HIS VERIFICATION. THE LEARNED AO COULD NOT TR ACE THOSE TWO PARTIES. THE ASSESSEE ALSO PRODUCED THE LEDGER ACCOUNTS OF ALL THOSE PART IES COMMENCING FROM ASST YEAR 2003-04 ONWARDS. THE ASSESSEE STATED THAT THESE LO AN BALANCES WERE OUTSTANDING FROM ASST YEAR 1997-98 ONWARDS BUT RECORDS WERE AVAILABL E WITH THE ASSESSEE ONLY FROM ASST YEAR 2003-04 ONWARDS. THE ASSESSEE ARGUED THAT THE SOURCE OF CASH DEPOSITS IN THE BANK ACCOUNT TO THE TUNE OF RS. 36,50,036/- IS DULY EXPL AINED BY WAY OF LOAN BALANCES RECEIVED BACK FROM THE AFORESAID THREE PARTIES IN C ASH. THE ASSESSEE ALSO REQUESTED THE LEARNED AO TO ISSUE SUMMONS U/S 131 OF THE ACT TO T HOSE TWO PARTIES FOR CROSS VERIFICATION AND FOR THE VERIFICATION OF GENUINENES S OF THE CLAIM OF ASSESSEE. THIS EXPLANATION DID NOT HOLD WATER IN THE MIND OF THE L EARNED AO AND HE HELD THAT THE IDENTITY OF THE PARTIES, CREDITWORTHINESS OF THE PA RTIES AND GENUINENESS OF TRANSACTIONS NOT PROVED BY THE ASSESSEE AND ACCORDINGLY BROUGHT THE SAME TO TAX AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 3 4. ON FIRST APPEAL, THE ASSESSEE REITERATED THE S UBMISSIONS MADE BEFORE THE LEARNED AO. IT WAS ARGUED THAT THE ASSESSEE HAD PLACED TH E LAST KNOWN ADDRESS OF THE LOAN DEBTOR AS IS AVAILABLE IN ITS RECORDS TO THE LEARNE D AO AND THEREFORE THE DISCHARGE OF ONUS HAS BEEN DULY DONE BY IT. IT WAS ARGUED THAT HAD THE LEARNED AO ISSUED SUMMONS U/S 131 OF THE ACT TO THOSE PARTIES, THEY COULD HAV E FURNISHED NECESSARY EVIDENCES IN THIS REGARD. IT WAS ALTERNATIVELY ARGUED BY THE ASSESSE E THAT ADMITTEDLY, ONE OF THE BUSINESS OF ASSESSEE WAS MONEY LENDING AND THE LENDING TO TH ESE THREE PARTIES WERE MADE IN THE ORDINARY COURSE OF ITS MONEY LENDING BUSINESS AND T HEY WERE REMAINING OUTSTANDING FOR MORE THAN 10 YEARS. EITHER WAY, THE ASSESSEE HAD D ULY CREDITED THE MONIES TO THE ACCOUNT OF THE LOAN DEBTORS IN ITS BOOKS OF ACCOUNT S AND HAD REDUCED THE LOAN BALANCES IN ITS BALANCE SHEET WHICH EFFECTIVELY AMOUNTS TO W RITE OFF IN THE BOOKS OF ACCOUNTS. IN CASE IF THE AMOUNTS FOUND CREDITED IN THE BANK ACCO UNT IS ADDED AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT, THEN CORRESPONDINGLY THE ASSESSEE SHOULD BE GIVEN THE BENEFIT OF DEDUCTION OF BAD DEBT U/S 36(1)(VII) OF THE ACT OR AS REGULAR BUSINESS LOSS AS ADMITTEDLY MONEY LENDING IS ALSO ONE OF THE BUSINESSES OF THE ASSESSEE. IT WAS ARGUED THAT IF THE MONIES RECEIVED FROM THESE THREE PARTIES ARE NOT BE LIEVED TO BE GENUINE, THEN CORRESPONDINGLY THE ASSESSEE HAD ALREADY REDUCED TH E LOAN BALANCES (PART OF BUSINESS ACTIVITY) ON THE ASSET SIDE OF THE BALANCE SHEET WH ICH EFFECTIVELY AMOUNTS TO WRITE OFF THE BAD DEBT AND HENCE DEDUCTION FOR THE SAME SHOULD BE GIVEN AS GENUINE BUSINESS LOSS. THEREAFTER ,THIS BUSINESS LOSS WOULD GO TO SET OFF THE OTHER SOURCES INCOME AND IN EITHER WAY, IT WOULD ONLY BE REVENUE NEUTRAL. THE LEARNE D CIT(A) HOWEVER UPHELD THE VIEW OF THE LEARNED AO. AGGRIEVED, THE ASSESSEE IS IN A PPEAL BEFORE US ON THE FOLLOWING GROUNDS:- 1) THAT THE LEARNED C.I.T. APPEAL ERRED IN CONFIRM ING THE ADDITION OF RS.36,50,036/- BEING THE SUMS RECEIVED BACK FROM M/ S. BRAND ALLOYS AMOUNTING TO RS.22,53,810/-, M/S. RAJ ENTERPRISES R S.5,89,989/= AND VINAY KUMAR BAID RS.80,62,627/- WHICH IS DUE FROM THEM TO THE APPELLANT SINCE LAST MORE THAN TEN YEARS AND REFLECTED AS SUNDRY DE BTORS ( LOANS & ADVANCES) IN THE BALANCE SHEET. THE AFORESAID ADDIT IONS IS UNWARRANTED, BAD IN LAW AND NOT SUSTAINABLE. ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 4 2) THAT THE INCOME-TAX OFFICER ERRED IN INVOKING PR OVISIONS OF SEC.68 OF I.T. ACT AND THE LEARNED CIT(APPEALS) ERRED IN AGRE EING THE SAME, WHICH IS NOT APPLICABLE IN THE APPELLANTS CASE AND HENCE THE ADDITION OF RS.36,50,036/- IS BAD IN LAW. 3) THAT CONFIRMATION LETTER ALONG WITH PAN NO. AND SOURCE OF ADVANCE ETC HAD BEEN FURNISHED DURING THE ASST. YEAR 1997-98, T HE AFORESAID ADDITIONS OF RS.36,50,036/- IS UNWARRANTED, BAD IN LAW AND NO T SUSTAINABLE. IN FACTS THESE 3 FORMALITIES ARE REQUIRED FOR LOAN OR CREDIT TAKEN AND NOT FOR THE LOAN OR ADVANCE GIVEN BY THE APPELLANT OUT OF SOURCE REF LECTED IN ACCOUNTS. 4) THAT ALL THE CASE LAWS CITED BY THE LEARNED INCO ME-TAX OFFICER ARE CONNECTED OR RELATED TO CREDITORS OR LOAN TAKEN BUT IN THIS CASE THE SAME RELATES TO SUNDRY DEBTORS I.E. ADVANCE GIVEN BY US TO THE PARTIES IN EARLIER YEARS WHICH HAS BEEN RECEIVED BACK. THE CREDITWORTH INESS OF THE APPELLANT WHO HAS ADVANCED IS PROVED, THERE IS NO CREDIT ENTR Y IN APPELLANT'S BOOKS BUT SQUARED UP DEBIT ENTRY AND TAXES HAVE ALREADY B EEN PAID ON DEBIT ENTRIES. 5) THAT WITHOUT PREJUDICE TO ABOVE THE SUNDRY DEBTO RS FROM WHOM MONEY COULD NOT BE REALIZED AFTER LAPSE OF A DECADE, THE SAME IS TO BE TREATED AS BAD DEBTS AND THE BUSINESS LOSS OF BAD DEBTS AMOUNT ING TO RS.36,50,036/= MAY BE SET OFF AGAINST BUSINESS PROFIT FOR CASH DEP OSITS FOR THE EQUIVALENT AMOUNT AND NO ADDITION IN THIS ACCOUNT IS JUSTIFIAB LE. 5. THE LEARNED AR REITERATED HIS ARGUMENTS MADE B EFORE THE LEARNED CIT(A). HE PRAYED THAT ALTERNATIVELY THE MONIES NOT RECOVERED FROM THESE THREE PARTIES SHOULD BE ALLOWED AS BAD DEBT OR REGULAR BUSINESS LOSS AS THE ASSESSEE HAD DULY REMOVED THE LOAN BALANCES FROM THE BOOKS OF ACCOUNTS OF THE ASSESSEE WHICH AMOUNTS TO EFFECTIVE WRITE OFF OF THE SAME. HE FURTHER ARGUED THAT THE LEARNE D AO HAD NOT REJECTED THE BOOKS OF ACCOUNTS OF THE ASSESSEE BY POINTING OUT CERTAIN DE FICIENCIES THEREON. HE PLACED RELIANCE ON THE CO-ORDINATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF SANJEEV KE JRIWAL, KOLKATA VS ITO IN ITA NO. 371/KOL/2010 DATED 9.11.2 012 IN SUPPORT OF HIS CONTENTIONS. IN RESPONSE TO THIS, THE LEARNED DR VEHEMENTLY SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES. ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 5 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD INCLUDING THE PAPER BOOK FILED BY THE ASSESSEE COMP RISING OF (I) COPY OF PARTNERSHIP DEEDS DATED 1.4.1994, 1.4.2007 AND 1.4.2008 VIDE PA GES 1 TO 41 OF PAPER BOOK ; (II) COPY OF IT RETURN ACKNOWLEDGEMENT TOGETHER WITH AUD ITED ACCOUNTS FOR ASST YEAR 2009-10 VIDE PAGES 42 TO 56 ; (III) COPY OF ASSESS MENT ORDER U/S 143(3) OF THE ACT DATED 7.12.2010 FOR ASST YEAR 2008-09 VIDE PAGES 57 TO 72 ; (IV) COPY OF INTIMATION U/S 143(1) OF THE ACT DATED 27.7.2001 FOR ASST YEAR 1999-2000 VIDE PAGE 73 ; (V) COPY OF TAX AUDIT REPORT TOGETHER WITH AUDITED ACCO UNTS FOR ASST YEAR 1999-2000 VIDE PAGES 74 TO 105 ; (VI) COPY OF IT RETURN ACKNOWLEDG EMENT AND ASSESSMENT ORDER US 143(3) OF THE ACT FOR THE ASST YEAR 1998-99 VIDE PA GES 106 TO 113 AND (VII) COPY OF AUDITED BALANCE SHEET AS ON 31.3.1998 TOGETHER WITH TAX AUDIT REPORT VIDE PAGES 114 TO 140 . 6.1. WE FIND THAT THE ADDITION HAS BEEN MADE THE L EARNED AO ON THE GROUND THAT THE ASSESSEE COULD NOT OBTAIN THE CONFIRMATION FROM M/S RAJ ENTERPRISES AND M/S BRAND ALLOYS LTD. IT IS NOT IN DISPUTE THAT THE ASSESS EE HAD INDEED FURNISHED CONFIRMATION FROM MR.VINAY KUMAR BAID TOGETHER WITH HIS PAN DETA ILS WHICH FACT IS ALSO MENTIONED IN THE ASSESSMENT ORDER. THE ASSESSEE HA D CLAIMED THAT THE SOURCE OF CASH DEPOSITS ARE NOTHING BUT REALIZATION OF LOAN DUES F ROM THE THREE PARTIES IN CASH WHICH WERE DEPOSITED INTO THE BANK ACCOUNT OF THE ASSESSE E. IT IS NOT IN DISPUTE THAT THE ASSESSEE HAD INDEED REQUESTED THE LEARNED AO TO ISS UE SUMMONS TO M/S RAJ ENTERPRISES AND M/S BRAND ALLOYS LTD TO MAKE VERIFI CATION OF THE SUBJECT MENTIONED RECEIPTS. BUT THE SAID SUMMONS COULD NOT BE SERVE D ON THE PARTIES AT THE ADDRESS GIVEN BY THE ASSESSEE TO LEARNED AO. THE ASSESSEE HAD O NLY PROVED THE IDENTITY OF THE LOAN CREDITORS (AS THEY ARE EXISTING FROM 31.3.1998 IN I TS BOOKS WHICH IS ALSO ACCEPTED BY REVENUE) , BUT HOWEVER, THE ASSESSEE WAS NOT ABLE T O PROVE THE CREDITWORTHINESS OF THOSE PARTIES. THE GENUINENESS OF TRANSACTION HAS NOT BEEN PROVED BY THE ASSESSEE. IN THESE CIRCUMSTANCES, THOUGH THERE IS NO DIRECT EVID ENCE TO PROVE THAT THE ASSESSEE HAD ONLY ROUTED ITS UNDISCLOSED MONIES IN THE FORM OF R EALIZATION FROM LOAN PARTIES, BY ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 6 VIRTUE OF OPERATION OF DEEMING PROVISIONS OF SECTIO N 68 OF THE ACT, THE ADDITION MADE BY THE LEARNED AO NEEDS TO BE SUSTAINED. WITH REGAR D TO THE DECISION RELIED UPON BY THE LEARNED AR ON THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF S ANJEEV KEJRIWAL VS ITO IN ITA NO. 371/KOL/2010 DATED 9.11. 2012 , WE FIND THAT THE FACTS STATED THEREON ARE SQUARELY DISTINGUISHABLE WITH RE GARD TO REALIZATION OF MONIES FROM DEBTORS. IN THAT CASE, THERE WAS A CLEAR FINDING G IVEN BY THE LEARNED CIT(A) THAT THE MONIES RECEIVED REPRESENT REALIZATION FROM DEBTORS. WHEREAS, IN THE INSTANT CASE, THE ENTIRE DISPUTE REVOLVES ON THE FACT OF REALIZATION OF MONIES FROM LOAN DEBTORS. HENCE RELIANCE PLACED ON THE AFORESAID DECISION DOES NOT ADVANCE THE CASE OF THE ASSESSEE ON THIS ASPECT. HENCE THE SAME WOULD BECOME TAXAB LE AS INCOME FROM OTHER SOURCES. 6.2. IT IS NOT IN DISPUTE THAT THE ASSESSEE HAD SH OWN THESE LOAN BALANCES DUE FROM THESE THREE PARTIES AS LOANS AND ADVANCES RECEIVABLE IN I TS BALANCE SHEET FOR MORE THAN 10 YEARS. IT IS ALSO NOT IN DISPUTE THAT ONE OF THE MAIN BUSINESSES OF THE ASSESSEE FIRM IS MONEY LENDING ACTIVITY. THIS IS QUITE EVIDENT FROM THE VARIOUS PARTNERSHIP DEEDS OF THE ASSESSEE VIDE CLAUSE 3 WHICH ARE REPRODUCED HEREIN BELOW FOR THE SAKE OF CONVENIENCE :- 3. THAT THE BUSINESS OF THE FIRM SHALL BE MAINLY TH AT OF EXPORT & IMPORT OF AGRO PRODUCTS LIKE RAW COTTON, PULSES, FOOD GRAIN, SPICES ETC., GINNING AND PRESSING OF COTTON, COMMISSION AGENT, MANUFACTURER S REPRESENTATIVE, GENERAL MERCHANT, FINANCIER INCLUDING MONEY LENDING BUSINESS, REAL ESTATE AND SHALL BE ENTITLED TO CARRY ON ANY OTHER TRADE O R BUSINESS OR MANUFACTURING WHATSOEVER AS MUTUALLY AGREED UPON BY THE PARTNERS. THE SAME CLAUSE IS PRESENT IN THE ORIGINAL PARTNERS HIP DEED DATED 1.4.1994 VIDE CLAUSE 3 AND ALSO IN RECONSTITUTED PARTNERSHIP DEEDS DATED 1.4.2007 AND 1.4.2008. THIS GOES TO PROVE THAT THE ASSESSEE IS INDEED ENGA GED IN MONEY LENDING BUSINESS ALSO. WE ALSO FIND THAT THE ASSESSEE HAD DULY SHOWN THE A MOUNTS RECEIVABLE FROM THE AFORESAID THREE PARTIES (I.E RAJ ENTERPRSIES, BRAND ALLOYS LTD AND VINAY KUMAR BAID) AS LOANS AND ADVANCES IN THE BALANCE SHEET AS ON 31 .3.2008 (IMMEDIATELY PRECEDING ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 7 ASST YEAR) WITH THE BALANCES OF RS. 36,50,036/- IN TOTAL OF THESE THREE PARTIES. THIS GOES TO PROVE THAT THE ASSESSEE HAD CONTINUED ITS M ONEY LENDING BUSINESS. DURING THE ASST YEAR UNDER APPEAL, THE BALANCES FROM THESE THR EE PARTIES ARE SHOWN AS NIL IN VIEW OF RECOVERIES MADE BY THE ASSESSEE FROM THEM, ACCOR DING TO ASSESSEE , WHICH FACT IS ALSO EVIDENT FROM THE BALANCE SHEET AS ON 31.3.2009 FILED IN THE PAPER BOOK. HOWEVER, THE REALIZATION OF MONIES FROM THESE LOAN PARTIES H AVE BEEN DISBELIEVED BY THE LEARNED AO AND WE HAVE ALREADY GIVEN OUR FINDING IN THAT RE GARD HEREINABOVE IN FAVOUR OF THE REVENUE. BUT ONE MORE FACT CANNOT BE SWEPT UNDER T HE CARPET THAT THE ASSESSEE HAD BROUGHT THE LOAN BALANCES FROM THESE THREE PARTIES TO NIL AS ON 31.3.2009 IN ITS BOOKS OF ACCOUNTS. IT IS NOT IN DISPUTE THAT THE ASSESSE E WAS INDEED CARRYING ON MONEY LENDING BUSINESS IN THE PAST AND HAD DERIVED INTERE ST INCOME THEREON. THIS IS QUITE EVIDENT FROM THE COPY OF AUDITED BALANCE SHEETS FIL ED BY THE ASSESSEE FOR THE YEARS ENDED 31.3.1998 AND 31.3.1999, WHEREIN THE INTEREST INCOME IS ADMITTED BY THE ASSESSEE AS INCOME FROM BUSINESS. IT IS ALSO NOT I N DISPUTE THAT THE REVENUE HAD ALSO ACCEPTED THE SAME AS INCOME FROM BUSINESS IN THE PA ST. IT IS NOT IN DISPUTE THAT THE ASSESSEE HAD CONTINUED TO CARRY ON ITS MONEY LENDIN G BUSINESS. IT IS ALSO NOT IN DISPUTE THAT THE LENDING TO THESE PARTIES WERE MADE IN THE ORDINARY COURSE OF MONEY LENDING BUSINESS OF THE ASSESSEE. SINCE THE ASSES SEE HAS CLAIMED THAT THE MONIES HAVE BEEN REALIZED FROM THESE PARTIES, IT IS ESTOPPED FR OM PROCEEDING AGAINST THESE PARTIES FROM MAKING ANY RECOVERIES. IT IS ALSO NOT IN DI SPUTE THAT THE ASSESSEE HAD BROUGHT THE BALANCES OF THESE PARTIES TO NIL AS ON 31.3.200 9 IN ITS BOOKS OF ACCOUNTS. HENCE THE ASSESSEE IS ENTITLED TO CLAIM THE BALANCES OF THESE THREE PARTIES AS A TRADING LOSS U/S 28 OF THE ACT. IN VIEW OF THESE FACTS AND CIRCUMSTANCE S, WE FIND LOT OF FORCE IN THE ALTERNATIVE ARGUMENT OF THE ASSESSEE THAT THE NON-R ECOVERY OF THE LOAN DUES , ACCORDING TO LEARNED AO, SHOULD BE ALLOWED AS A DEDUCTION AS REGULAR BUSINESS LOSS FROM MONEY LENDING ACTIVITY , WHICH IN TURN WOULD ONLY GO TO I NCREASE THE BUSINESS LOSS OF THE ASSESSEE FOR THE YEAR UNDER APPEAL AND THE SAME WOU LD IN TURN BE AVAILABLE FOR SET OFF AGAINST THE ALLEGED INCOME FROM OTHER SOURCES U/S 6 8 OF THE ACT. HENCE IN ANY CASE, NO ADDITION COULD BE MADE IN THE HANDS OF THE ASSESSEE IN THE SUM OF RS. 36,50,036/-. ITA NO. 683/KOL/2013-B-AM M/S. D.K. INDUSTRIES 8 HENCE WE FIND LOT OF FORCE IN THE ALTERNATIVE ARGUM ENT OF THE LEARNED AR. ACCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. THIS ORDER IS PRONOUNCED IN OPEN COURT ON 8-4 - 2016 1.. THE APPELLANT/ASSESSEE: M/S. D.K INDUSTRIES 2 CLIVE GHAT STREET, 3 RD FLOOR KOLKATA-700 001. 2 THE RESPONDENT/DEPARTMENT: THE INCOME TAX OFFICER , WARD 34(3), 110 SHANTI PALLI, AAYKAR PURBA, KOLKATA. 3 /THE CIT, 4.THE CIT(A ) 5. DR, KOLKATA BENCH 6. GUARD FILE. TRUE COPY, BY ORDER, ASSTT REGISTRAR **PRADIP SPS SD/- ( N.V.VASUDEVAN, JUDICIAL MEMBER ) SD/- (M. BALAGANESH, ACCOUNTANT MEMBER) DATE: DATE 8-4 -2016 COPY OF THE ORDER FORWARDED TO:-