I.T.A. No. 1080/Ahd/2011, (Assessment Year: 2007-2008). Case: The ITO Vs Karnavati Engineering Ltd.. ITAT (Income Tax Appellate Tribunal)
| Case Number | I.T.A. No. 1080/Ahd/2011, (Assessment Year: 2007-2008) |
| Counsel | For Appellant: P.L. Kureel, Sr. DR and For Respondents: S.N. Soparkar and Parin Shah, ARs |
| Judges | Anil Chaturvedi, Member (A) and Kul Bharat, Member (J) |
| Issue | Income Tax Act, 1961 - Sections 143(3), 36(1)(vii) |
| Judgement Date | June 30, 2014 |
| Court | ITAT (Income Tax Appellate Tribunal) |
Order:
Kul Bharat, Member (J), (ITAT Ahmedabad 'B' Bench)
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This appeal by the Revenue is directed against the order of the Ld. Commissioner of Income Tax(Appeals)-VIII, Ahmedabad ('CIT(A)' in short) dated 25/01/2011 pertaining to Assessment Year (AY) 2007-08. The Revenue has raised the following grounds of appeal:-
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The ld. CIT(A)-VIII, Ahmedabad has erred in law and on facts in deleting the disallowance of Rs. 10,77,651/- made by the A.O. on account of claim of bad debts, without properly appreciating the facts of the case and the material brought on record by the Assessing Officer.
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The ld. CIT(A) has erred in law and on facts in deleting the disallowance of Rs. 2,50,719/- out of disallowance of Rs. 4,80,020/- made by the Assessing Officer on account of prior period expenses, without properly appreciating the facts of the case and the material brought on record by the Assessing Officer.
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On the facts and in the circumstances of the case, the learned CIT(A) ought to have upheld the decision of the Assessing Officer.
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It is, therefore, prayed that the orders of the Ld. CIT(A) may be set aside and that of the Assessing Officer may be restored to the above extent.
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Briefly stated facts are that the case of the assessee was picked up for scrutiny assessment and the assessment u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") was framed vide order dated 31/12/2009, thereby the Assessing Officer (AO in short) made disallowance of bad debts amounting to Rs. 10,77,651/- and disallowance of prior period expenses amounting to Rs. 4,80,020/-. Against this, the assessee filed an appeal before the ld. CIT(A), who after considering the submissions of the assessee, partly allowed the appeal of the assessee. Against the order of the ld. CIT(A), now the Revenue is in appeal before us.
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First ground is against deletion of disallowance of bad debts amounting to Rs. 10,77,651/-. The ld. Sr. DR vehemently argued that the order of the ld. CIT(A) is not justified and he supported the order of the AO. On the contrary, ld. counsel for the assessee submitted that the AO has made reliance on the judgment of Jurisdictional High Court rendered in the case of Dhall Enterprises. He submitted that this judgment of Hon'ble Jurisdictional High Court has been disapproved by the Hon'ble Apex Court. He submitted that the Hon'ble Apex Court rendered in the case of TRF Ltd. vs. CIT reported at (2010) 323 ITR 397 (SC).
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