Inductotherm (India) Ltd., Ahmedabad V. The ACIT.,Circle-4, Ahmedabad

MA 80/AHD/2010

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 7900 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-04-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2001-2002
• Appeal Filed On: 08-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M K PATEL
• Keywords: Bad and doubtful debts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD (BEFORE SHRI D. K. TYAGI, JM AND SHRI A. MOHAN ALAN KAMONY, AM) M. A. NO.80/AHD/2010 ((IN ITA NO.1174/AHD/2005 AY: 2001-02) M/S. INDUCTOTHERM (INDIA) PVT. LTD., AMBLI BOPAL ROAD, BOPAL, AHMEDABAD PA NO. AAACI 3672 B VS THE A. C. I. T., CIRCLE-4, NAVJIVAN TRUST BUILDING, NR. NAVJIVAN PRESS, ASHRAM ROAD, AHMEDABAD (APPLICANT) (RESPONDENT) APPLICANT BY SHRI M. K. PATEL, AR RESPONDENT BY SHRI VINOD TANWANI, SR. DR DATE OF HEARING: 20-04-2012 DATE OF PRONOUNCEMENT: 20-04-2012 ORDER PER A. MOHAN ALANKAMONY : THIS MISC. APPLICATION IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE TRIBUNAL DATED 22-01-2010 IN ITA NO.1174/AHD/2005 FOR ASSESSMENT Y EAR 2001-02. 2. THE LEARNED AR SUBMITTED THAT THE LEARNED AO HAD DISALLOWED A SUM OF RS.5,45,954/- CLAIMED BY THE ASSESSEE AS B AD DEBTS SINCE IT WAS IN THE NATURE OF ROUTINE WRITE OFF WITHOUT PROV ING THAT THE DEBT HAS BECOME BAD. IT WAS FURTHER SUBMITTED THAT THE LEARN ED CIT(A) WHILE DEALING WITH THE APPEAL BY RELYING UPON THE DECISIO N OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF GIRISH BHAGWAT PR ASAD, 256 ITR 772 ALLOWED THE CLAIM OF THE ASSESSEE, HOWEVER, ON APPEAL BY THE REVENUE BEFORE THE TRIBUNAL THE MATTER WAS RESTORED BACK TO THE FILE OF THE AO WITH THE FOLLOWING OBSERVATION: MA NO.80/AHD/2010 (IN ITA NO.1174/AHD/2005 AY: 2001-02 M/S. INDUCTOTHERM (INDIA) PVT. LTD. VS ACIT, CIR-4, AHMEDABAD 2 33. AS ALREADY MENTIONED ABOVE, SINCE THERE IS NOTH ING TO SUGGEST THAT THE ASSESSEE SUBMITTED ANY MATERIAL BE FORE THE LOWER AUTHORITIES IN SUPPORT OF THEIR CLAIM FOR DED UCTION OF THE AFORESAID AMOUNTS AS BAD DEBTS NOR THERE IS ANY MAT ERIAL BEFORE US, WHICH COULD SHOW THAT THE SAID DEBTS WER E BAD, IN THE LIGHT OF VIEW TAKEN IN THE AFORESAID DECISION O F HONBLE JURISDICTIONAL HIGH COURT IN DHALL ENTERPRISES AND ENGINEERS P. LTD. (SUPRA) AND SUPPORTED BY THE DECISION OF THE A LLAHABAD HIGH COURT IN KOHLI BROTHERS COLOR LAB (P) LTD. (SU PRA), WE HAVE NO ALTERNATIVE BUT TO REVERSE THE FINDINGS OF THE LD. CIT(A) AND RESTORE THE ORDER OF THE AO. THEREFORE, GROUND NO.1 IN THE APPEAL OF THE REVENUE FOR THE AY 2001-02 IS ALLOWED . 3. THE LEARNED AR HUMBLY SUBMITTED THAT IN CIRCULA R NO.68 DATED 17-11-1971, IT WAS ACCEPTED BY THE CENTRAL BOARD OF DIRECT TAXES THAT AS A RESULT OF SUBSEQUENT INTERPRETATION OF LA W BY THE HONBLE SUPREME COURT OF INDIA, ANY CONTRARY FINDING WILL C ONSTITUTE MISTAKE APPARENT FROM RECORD. THE LEARNED AR CITED THE RECE NT DECISION OF THE HONBLE APEX COURT IN THE CASE OF TRF LTD VS CIT 35 DTR 156, WHEREIN IT WAS HELD THAT AFTER 1 ST APRIL, 1989 IT IS NOT NECESSARY FOR THE ASSESSEE TO ESTABLISH THAT THE DEBT, IN FACT, H AS BECOME IRRECOVERABLE. IT IS ENOUGH IF THE BAD DEBT IS WRIT TEN OFF AS IRRECOVERABLE IN THE ACCOUNTS OF THE ASSESSEE AND PRAYED THAT THE ORDER OF THE TRIBUNAL SUFFERS MISTAKE APPARENT ON RECORD ON THE ISSUE OF BAD DEBTS AND THE SAME MAY BE RECTIFIED. 4. THE LEARNED DR COULD NOT CONTROVERT THE SUBMISSI ONS OF THE LEARNED AR. 5. WE HAVE HEARD THE RIVAL SUBMISSION AND CAREFULLY PERUSED THE MATERIALS ON RECORD AND THE ORDER OF THE TRIBUNAL A LONG WITH THE ORDER OF THE HONBLE APEX COURT CITED SUPRA. FROM THE FAC TS MENTIONED MA NO.80/AHD/2010 (IN ITA NO.1174/AHD/2005 AY: 2001-02 M/S. INDUCTOTHERM (INDIA) PVT. LTD. VS ACIT, CIR-4, AHMEDABAD 3 HEREINABOVE BY THE LEARNED AR, IT IS APPARENT THE O RDER OF THE TRIBUNAL SUFFERS MISTAKE APPARENT ON RECORD WITH RE SPECT TO THE ADJUDICATION OF THE ISSUE OF BAD DEBTS. HENCE, WE R ECALL THE ORDER OF THE TRIBUNAL TO THAT EXTENT AND BY FOLLOWING THE OR DER OF THE HONBLE APEX COURT CITED SUPRA DECIDE THE ISSUE IN FAVOUR O F THE ASSESSEE BY ALLOWING THE CLAIM OF BAD DEBTS OF RS.5,45,954/-. I T IS ORDERED ACCORDINGLY. 6. IN THE RESULT, THE MISC. APPLICATION FILED BY TH E ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 20-04-2012. SD/- SD/- (D.K. TYAGI) JUDICIAL MEMBER (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER LAKSHMIKANT DEKA/ LAKSHMIKANT DEKA/ LAKSHMIKANT DEKA/ LAKSHMIKANT DEKA/- -- - COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER D Y. REGISTRAR, ITAT, AHMEDABAD