ACIT, Noida v. M/s Spice Systems Ltd., Noida

ITA 1593/DEL/2011 | 2005-2006
Pronouncement Date: 21-11-2014 | Result: Partly Allowed

Appeal Details

RSA Number 159320114 RSA 2011
Assessee PAN AABCM0820A
Bench Delhi
Appeal Number ITA 1593/DEL/2011
Duration Of Justice 3 year(s) 7 month(s) 20 day(s)
Appellant ACIT, Noida
Respondent M/s Spice Systems Ltd., Noida
Appeal Type Income Tax Appeal
Pronouncement Date 21-11-2014
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted G
Tribunal Order Date 21-11-2014
Date Of Final Hearing 29-10-2014
Next Hearing Date 29-10-2014
Assessment Year 2005-2006
Appeal Filed On 01-04-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G NEW DELHI) BEFORE SHRI H. S. SIDHU JUDICIAL MEMBER AND SHRI T.S. KAPOOR ACCOUNTANT MEMBER I.T.A. NO. 1592 & 1593/DEL/2011 ASSESSMENT YEAR : 2003-04 & 2005-06 ACIT CIRCLE VS. M/S. IO SYSTEMS LTD. NOIDA PREVIOUSLY KNOWN AS M/S. SPICE SYSTEM LTD. D-1. SECTOR -3 NOIDA GIR / PAN:AABCM0820A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VIKRAM SINHA SR. DR RESPONDENT BY : SHRI AJAY VOHRA SR. ADV. MS. BHAVITA KUMAR ADV MS. SHIKHA SHARMA CA ORDER PER T.S. KAPOOR AM: THESE ARE TWO APPEALS FILED BY THE REVENUE AGAINST SEPARATE ORDERS OF LD. CIT(A) BOTH DATED 10.01.2011. THE REVENUE HAS TAKEN THREE GROUNDS OF APPEAL IN I.T.A.NO. 1592. WHEREAS IT HAS TAKEN TW O GROUNDS OF APPEAL IN I.T.A.NO. 1593. GROUNDS 2 AND 3 IN I.T.A.NO. 1592 ARE SIMILAR TO GROUNDS 1 & 2 IN I.T.A.NO. 1593 EXCEPT DIFFERENCE IN AMOUNT. GROUND NO.1 IN I.T.A.NO. 1592 RELATES TO ACTION OF LD. CIT(A) BY W HICH HE HAS REDUCED THE ADDITION ON ACCOUNT OF ADVERTISEMENT AND MARKETING EXPENSES TO 20% FROM 50% MADE BY A.O. GROUND NO.2 IN I.T.A.NO. 1592 AND GROUND NO.1 IN I.T.A. NO. 1593 RELATES TO THE ACTION OF LD. CIT(A) BY WHICH HE HAD DELETED THE DISALLOWANCE WHICH WAS MADE BY THE A.O. ON ACCO UNT OF COMMISSION TO VARIOUS PERSONS. GROUND NO.3 IN I.T.A.NO. 1592 AND GROUND NO.2 IN ITA NOS.1592 & 2593/DEL/2011 2 I.T.A.NO. 1593 RELATE TO THE ACTION OF LD. CIT(A) B Y WHICH HE HAD DELETED THE ADDITION MADE BY THE A.O. ON ACCOUNT OF BAD DEB TS WRITTEN OFF. 2. AT THE OUTSET LD. A.R. FILED A CHART NARRATING THEREIN THE ISSUE INVOLVED IN THESE APPEALS. REGARDING THE ISSUE INV OLVED IN GROUND NO.1 AND 2 IN I.T.A.NO. 1592 LD. D.R. HEAVILY RELIED UPON T HE ORDER OF THE A.O. IN RESPECT OF GROUND NO.2 IN I.T.A.NO. 1593 LD. D.R. SUBMITTED THAT LD. CIT(A) HAS FOLLOWED THE EARLIER YEAR ORDER OF THE T RIBUNAL IN THE CASE OF ASSESSEE WHICH IS NOT CORRECT AS NO LEGAL ISSUE WAS INVOLVED AND RATHER THE A.O. HAD DISALLOWED THE COMMISSION PAYMENT CLAIMED BY THE ASSESSEE AND THE ASSESSEE WAS NOT ABLE TO FILE CONFIRMATION FOR THE SAME. LD. CIT(A) WITHOUT APPRECIATING THE FACTS OF THE PRESENT CASE DELETED THE ADDITION FOLLOWING THE EARLIER ORDER OF THE TRIBUNAL. 3. LD. A.R. ON THE OTHER HAND SUBMITTED THAT THE FI RST ISSUE IN I.T.A.NO. 1592 IS ALREADY COVERED IN FAVOUR OF THE ASSESSEE. IT WAS SUBMITTED THAT HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS PEPS ICO HOLDINGS INDIA PVT. LTD. 207 TAXMAN 5 (DEL.) HAS CLEARLY HELD THAT ADVE RTISEMENT AND MARKETING EXPENSES ARE REVENUE IN NATURE AND ARE ALLOWABLE IN THE YEAR OF INCURRING. LD. A.R. SUBMITTED THAT SIMILAR DECISIONS WERE REND ERED BY HON'BLE HIGH COURT IN THE FOLLOWING CASES: I) CIT VS CASIO INDIA LTD. 335 ITR 196 II) ITO VS SPICE COMMUNICATIONS LTD. 35 SOT 78 (DEL .) III) DCIT VS BOUGAINVILLEA MULTIPLEX & ENTERTAINMEN T CENTRE P. LTD. I.T.A.NO. 5517/DEL/2010 (DEL. TRI.) 4. LD. A.R. FURTHER SUBMITTED THAT THE A.O. HAD MAD E DISALLOWANCE FOR AN AMOUNT EQUAL TO 50% OF ADVERTISEMENT EXPENSE WHEREA S LD. CIT(A) HAS RESTRICTED THE DISALLOWANCE TO 20% WHICH IS NOT AS PER LAW BUT SINCE THE ITA NOS.1592 & 2593/DEL/2011 3 ASSESSEE HAS NOT FILED APPEAL THEREFORE HE WAS DE FENDING ONLY THE DEPARTMENTAL APPEAL. 5. AS REGARDS THE 2 ND ISSUE OF COMMISSION TO VARIOUS PERSONS LD. A.R. SUBMITTED THAT SIMILAR DISALLOWANCES WERE MADE IN A SSESSEES OWN CASE IN ASSESSMENT YEAR 2004-05 IN I.T.A.NO. 595/DEL/2008 A ND THE HONBLE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASS ESSEE. 6. REGARDING ADDITION ON ACCOUNT OF BAD DEBTS WRITT EN OFF LD.A.R. HEAVILY RELIED UPON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF TRF LTD. VS ACIT 323 ITR 397 AND IT WAS SUBMITTED T HAT AMOUNTS WERE ACTUALLY WRITTEN OF IN THE BOOKS OF ACCOUNT AND THE REFORE WAS ALLOWABLE DEDUCTION. THE A.O. HAD DISALLOWED THE CLAIM ONLY ON THE BASIS THAT THE ASSESSEE WAS DEALING WITH THE GOVERNMENT UNDERTAKIN G AND IT CANNOT BE SAID THAT AMOUNTS FROM GOVERNMENT UNDERTAKING WAS NOT RE COVERABLE. HOWEVER IT WAS SUBMITTED THAT IN ORDER TO RETAIN BUSINESS R ELATIONS THE ASSESSEE HAD FOLLOWED RECOVERY OF PAYMENT TO SOME EXTENT AND AFT ER WHICH IT GAVE UP IN THE INTEREST OF BUSINESS. IT WAS FURTHER SUBMITTED THAT SIMILAR ISSUE WAS DECIDED BY LD. CIT(A) IN ASSESSMENT YEAR 2004-05 AG AINST WHICH REVENUE HAS NOT FILED ANY APPEAL. 7. IN HIS REJOINDER LD. D.R. SUBMITTED THAT IN RES PECT OF COMMISSION EXPENSES THE ASSESSEE HAD NOT FILED ANY CONFIRMATI ON AND ASSESSEE COULD NOT JUSTIFY THE GENUINENESS OF COMMISSION EXPENSES. 8. WE HAVE HEARD RIVAL PARTIES AND HAVE GONE THROUG H THE MATERIAL PLACED ON RECORD. WE FIRST TAKE UP I.T.A. NO. 1592/DEL/20 11 FOR THE ASSESSMENT YEAR 2003-04. THE 1 ST GROUND TAKEN BY THE ASSESSEE IS REGARDING DISALLOWANCE ON ACCOUNT OF ADVERTISEMENT AND MARKET ING EXPENSES. WE FIND ITA NOS.1592 & 2593/DEL/2011 4 THAT THE A.O. HAD DISALLOWED 50% OF ADVERTISEMENT A ND MARKETING EXPENSES ON THE BASIS THAT THE ASSESSEE WAS UNABLE TO SUBSTA NTIATE THE EXPENSES AND GENUINENESS OF EXPENSE WAS DOUBTED BY THE A.O. IT IS NOT A CASE WHERE THE A.O. DISALLOWED THE CLAIM OF THE ASSESSEE HOLDING T HAT THE EXPENDITURE WAS CAPITAL IN NATURE. THE RELEVANT FINDINGS OF THE A. O. ARE REPRODUCED BELOW: 7. ADVERTISEMENT AND MARKETING EXPENSES IN THE OPERATIVE EXPENSES UNDER THE HEAD ADVERTISEM ENT AND MARKETING THE ASSESSEE CLAIMED THE EXPENSES OF RS. 26 68 975/- AS AGAINST OF S.15.84 102/- THE DETAILS OF THE SAME W AS SUBMITTED BY THE ASSESSEE AND THE PERUSAL OF THE DETAILS SHOWS THAT THE EXPENSES OF RS.15 43 301/- FOR ADVERTISEMENT RS.7 64 679/- FOR BUSINESS PROMOTION RS.L 97 165/- FOR CONFERENCE EXPENSES AN D EXHIBITION EXPENSES OF RS.1 63 830/-. FURTHER THE PERUSAL OF T HE DETAILS OF ADVERTISEMENT EXPENSES SHOWS THE HEAVY EXPENSES FOR PURCHASING OF GIFT ITEMS FROM M/S AKSHAY SALES PVT. LTD ON 19.10. 2002 FOR RS.7 73 150/- AMOUNT DEBITED RS.1 LO OOOI- IN THE NAME OF K.D. & SONS ON 24.12.2002 AND RS.L 25 000/- ON 27.12.2002 AND IN THE NAME OF LIBRA SALES ENTERPRISES FOR RS.L 60 000/- ON 31. 12.2002 AND ON 31.3.2003 FOR PURCHASE OF PARTLY CATELOGUE ON ART C ARD BESIDE IT THE ASSESSEE HAS MADE REGULAR EXPENSES THROUGH CASH AS BUSINESS PROMOTION. THE AMOUNT OF RS.2 02 760/- HAS ALSO BEE N DEBITED THROUGH PAY-ORDER UNDER THE HEAD EXPENSES PAYABLE F OR DIGITAL DIARY WITH REFERENCE NUMBER SBP/496 DATED 9.3.2003. THE A SSESSEE WAS ASKED TO JUSTIFY FOR MAKING THESE HEAVY EXPENSES. T HE ASSESSEE SUBMITTED VIDE LETTER DATED 6.2.2006 THAT THE EXPEN SES INCURRED ON THE OCCASION OF DIWALI AND MAHURAT AS SMALL GIFTS ARE I N THE NATURE OF BUSINESS EXPENDITURE AND COME WITHIN THE PURVIEW OF SECTION 37(1) OF THE LT.ACT. FURTHER SUBMITTED THAT IT COMMON PRACTI CE TO SERVE FOOD & BEVERAGES TO THE PARTICIPANTS IN THE CONFERENCE AND SEMINARS HELD BY BUSINESS HOUSES AND THE EXPENSES WERE ESSENTIAL WH ICH CANNOT BE CONSIDERED AS ENTERTAINMENT EXPENSES DISALLOWABLE U NDER SECTION 37(2) OF THE LT. ACT. THE ASSESSEE RELIED ON THE DE CISION REFERRED BY IT IN THE SAID LETTER. THE SUBMISSION OF THE ASSESSEE IS NOT ACCEPTABLE BECAUSE NEITHER THE ASSESSEE HAS FURNISHED THE DETA ILS OF THE CONFERENCE HELD DURING THE YEAR NOR IT HAS SUBMITTE D THAT HOW MUCH ITA NOS.1592 & 2593/DEL/2011 5 ORDER WERE OBTAINED IN CONDUCTING THE SEMINAR OR TH E CONFERENCE MERE CREATING THE DOCUMENTS FOR EXPENSES CANNOT BE CONSIDERED TO BE ALLOWED AS DECIDED BY THE HON'BLE SUPREME COURT IN THE CASE OF M/S. LAXMI NARAIN COTTON MILLS CO. LTD. VS. CIT(1969)73I TR 634(SC) & M/S. LAXMI NARAIN MADAN LAL VS. CIT (1972)86ITR439( SC) [SUPRA]. ACCORDINGLY CONSIDERING THE NECESSITY AND PAST YEAR S EXPENSES THE 50% EXPENSES I.E. RS.13 34 487/- CLAIMED UNDER THIS HEAD ARE DISALLOWED. ADDITION OF RS.13 34 487/-. 9. LD. CIT(A) HAS ALLOWED THE RELIEF TO THE ASSESS EE ON THE BASIS THAT MOST OF DETAILS OF EXPENSES AND EXPLANATION WERE FU RNISHED AND EXPENSES RELATED TO PROMOTION OF BUSINESS HOWEVER IN VIEW OF THE FACT THAT FEW VOUCHERS WERE NOT AVAILABLE HE REDUCED THE AMOUNT OF DISALLOWANCE FROM 50% TO 20%. THE CASE LAW RELIED UPON BY LD. A.R. A RE NOT RELEVANT AS THE ISSUE UNDER THOSE CASES WERE AS TO WHETHER THE ADVE RTISEMENT EXPENSE WERE CAPITAL IN NATURE OR REVENUE IN NATURE WHEREAS IN THE PRESENT CASE THE DISALLOWANCE WAS MADE ON ACCOUNT OF NON FURNISHING OF DETAILS AND EXPLANATION. HOWEVER LD. D.R. WAS NOT ABLE TO SUB STANTIATE AS TO WHY THE ACTION OF LD. CIT(A) FOR REDUCTION IN THE DISALLOWA NCE WAS NOT JUSTIFIED WHEREAS WE FIND THAT 50% DISALLOWANCE MADE BY A.O. WAS EXCESSIVE AND LD. CIT(A) HAS RIGHTLY REDUCED THE DISALLOWANCE TO 20%. IN VIEW OF THE ABOVE GROUND NO.1 IN I.T.A.NO. 1592/DEL/2011 IS DI SMISSED. 10. IN GROUND NO.2 THE A.O. MADE DISALLOWANCE BY H OLDING AS UNDER: COMMISSION:- UNDER THE HEAD COMMISSION TO SELLING AGENTS DEBITED TO RS.34 86 765/-WHICH HAS BEEN BIFURCATED AS COMMISSI ON [ASP] OF RS.I0 40 472/- AND OTHER COMMISSION RS.24 46 292/- AS AGAINST OF RS.34 35 090/- IN THE LAST YEAR. THE ASSESSEE WAS A SKED TO JUSTIFY THE COMMISSION PAID TO THE AGENTS SERVICE RENDERED BY THEM CONFIRMATION FROM THEM BY GIVING THEIR INCOME TAX P ARTICULARS AND ITA NOS.1592 & 2593/DEL/2011 6 NEXUS BETWEEN THE SALE AND COMMISSION CLAIMED. THE ASSESSEE VIDE ITS LETTER DATED 20.12.2005 FURNISHED THE COMPLETE LIST OF THE COMMISSION AGENTS BUT NEITHER ANY CONFIRMATION NOR THE DETAILS OF THE SERVICES AND PARTY FOR WHOM IT WAS RENDERED HAVE BEEN FURNISHED. IT IS ALSO PERTINENT TO MENTION THAT THE NAME OF M/S PERAMETT INDIA LIMITED HAS ALSO BEEN REFLECTED IN THE LIST OF THE COMMISSION A GENT TO WHOM THE COMMISSION CREDITED RS.5 00 000/- ON 10.5.2002 RS. 6 00 000/- ON 11.6.2002 BUT NO SERVICES OR ORDER PROCURED BY HIM HAS BEEN FURNISHED THE SAME ISSUE WERE INVESTIGATED IN DETAI L IN THE LAST YEAR AS M/S PERAMETT INDIA LIMITED WAS ALLOWED COMMISSION O F RS.21 78 188/- BUT THE ASSESSEE COULD NOT JUSTIFY THE PAYMENT OF COMMISSION. ON CONFRONTATION THE ASSESSEE HAS ALSO SUBMITTED THAT THE AGENT ARE NOT IN HIS CONTROL OR IN TOUCH WITH H IM THE CLAIM OF THE COMMISSION IS JUSTIFIED BECAUSE THE TDS HAS BEEN DE DUCTED TO THE GOVERNMENT ACCOUNT IN DUE COURSE OF TIME. THE SUBMI SSION OF THE ASSESSEE IS NOT ACCEPTED BECAUSE THE PREPARATION OF DOCUMENTS WITH THE CONVENIENCE OF SO-CALLED AGENT APPEARS TO HAVE BEEN MADE FOR DIVERSION OF INCOME. IN THIS RESPECT THE HON'BLE S UPREME COURT HAS ALSO HELD THAT 'IN THE CASE OF CLAIM OF COMMISSION THE BURDEN LIES ON THE ASSESSEE TO ESTABLISH THAT THE AGENT ACTUALLY R ENDER SERVICES. THE EXISTENCE OF AGREEMENT OR THE FACT OF PAYMENT CANNO T SUBSTITUTE SUCH BURDEN. M/S LAXMI NARAIN COTTON MILLS CO. LTD. VS. CIT(L969)73ITR 634(SC) & M/S LAXMI NARAIN MADAN LAL V S. CIT (1 97 2) 86 ITR 439 (SC). THEREFORE THE COMMISSION CLAIMED IS DISALLOW ED. ADDITION OF RS.34 86 765/-. 10. LD. CIT(A) HAS ALLOWED RELIEF TO ASSESSEE BY R ELYING UPON DELHI BENCH C DECISION IN I.T.A.NO. 595. WE FIND THAT THE TRIBUNAL IN I.T.A.NO. 595 IN THE CASE OF ASSESSEE ITSELF HAD ALLOWED RELI EF TO THE ASSESSEE ON THE BASIS THAT TAX WAS DEDUCTED AT SOURCE IN RESPECT OF PAYMENT OF COMMISSION AND SINCE THE ASSESSEE HAD SUBMITTED THE DETAILS OF COMMISSION PAYMENT THE A.O. COULD HAVE ENQUIRED FROM THE PAYEES DIRECTLY. IN THE PRESENT CASE ALSO WE FIND THAT THE DETAILS OF STATEMENT OF COMMISSION PAID IS PLACED AT PAPER BOOK PAGES 11-17 WHEREIN COMPLETE BREAKUP OF PAYMEN TS ALONG WITH TAX ITA NOS.1592 & 2593/DEL/2011 7 DEDUCTED FROM THE PAYMENTS IS PLACED. WE FIND THAT THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE ARE SIMILAR TO TH E FACTS AND CIRCUMSTANCES AS PROVIDED IN I.T.A.NO. 595 AND THEREFORE RESPECT FULLY FOLLOWING THE SAME WE ALLOW THE CLAIM OF THE ASSESSEE AND IN VIEW OF T HIS GROUND NO.2 IS DISMISSED. 11. AS REGARDS GROUND NO.3 WHICH IS REGARDING CLAIM OF BAD DEBT WRITTEN OFF WE FIND THAT LD. CIT(A) HAS ALLOWED RELIEF TO THE ASSESSEE FOLLOWING THE ORDER OF HON'BLE SUPREME COURT IN THE CASE OF TRF L TD. 323 ITSR 397. HOWEVER WE FIND THAT LD. CIT(A) HAS NOT ADDRESSED ANY OF THE OBJECTIONS RAISED BY A.O. IN HIS ASSESSMENT ORDER NOR LD. A.R. HAD ADDRESSED THESE OBJECTION BEFORE LD. CIT(A) AS IS APPARENT FROM SUB MISSIONS BEFORE LD. CIT(A) PLACED AT PAPER BOOK PAGES 23 TO 41. THE LD . A.R. HAD RELIED UPON VARIOUS CASE LAWS WITHOUT ADDRESSING THE OBJECTIONS RAISED BY A.O. THE A.O. HAD MADE THE ADDITION BY HOLDING AS UNDER: 2. THE ASSESSEE DEALS WITH MOSTLY WITH THE GOVERNM ENT DEPARTMENT LIKE BANK AND GOVERNMENT MINISTRIES 1 UN DERTAKINGS FROM WHICH IT CANNOT BE SAID THAT THE AMOUNT IS NOT RECO VERABLE. WE MAY TAKE THE EXAMPLE FOR THE LIST PROVIDED IN RESPECT O F PROVISIONS MADE OF RS.40 78 812/- AS ON 31.3.2003. PERUSAL OF THE SAME SHOWS THERE IS AMOUNT DUE FROM KENDRIYA BHANDAR DELHI OF RS.15 00 000/- COMMISSIONER OF INCOME TAX RS.3 7801- MINISTRY OF COMMUNICATION AND INFORMATION RS.6 782/- FROM WHICH IT CANNOT BE EXPECTED THAT THE PAYMENT MAY NOT BE RECOVERED. 3. FURTHER PROVISION MADE IN RESPECT OF LOANS AND A DVANCES GIVEN OF RS.15 75 891/- DURING THE YEAR UNDER CONSIDERATI ON CAN ALSO NOT BE CONSIDERED THAT THE ADVANCE ARE OF REVENUE NATURE B UT THE ASSESSEE IS HABITUAL IN CLAIMING THE BAD DEBTS AS EVIDENT FROM THE PAST RECORD. ITA NOS.1592 & 2593/DEL/2011 8 12. LD. CIT(A) HAS NOT COMMENTED UPON CLAUSE (2)(I) OF SECTION 36. THE DEDUCTION U/S 36(1)(VII) IS ALLOWABLE SUBJECT TO CL AUSE (2)(I) OF SECTION 36. SUB-CLAUSE (2)(I) OF SECTION 36 READS AD UNDER: 36(2) IN MAKING ANY DEDUCTION FOR A BAD DEBT OR PA RT THEREOF THE FOLLOWING PROVISIONS SHALL APPLY (I) NO SUCH DEDUCTION SHALL BE ALLOWED UNLESS SUCH DEBT OR PART THEREOF HAS BEEN TAKEN INTO ACCOUNT IN COMPUTING TH E INCOME OF THE ASSESSEE OF THE PREVIOUS YEAR IN WHICH THE AMOU NT OF SUCH DEBT OR PART THEREOF IS WRITTEN OFF OR OF AN EARLIE R PREVIOUS YEAR OR REPRESENTS MONEY LENT IN THE ORDINARY COURSE OF THE BUSINESS OF BANKING OR MONEY LENDING WHICH IS CARRIED ON BY THE ASSESSEE. (II) 12.1 THEREFORE WE RESTORE THIS ISSUE TO THE OFFICE OF LD. CIT(A) WHO WILL PASS SPEAKING ORDER KEEPING IN VIEW THE PROVISIONS OF SECTION 36(1)(VII) READ WITH SECTION 36(2) AS PER LAW. NEEDLESS TO SAY THA T ASSESSEE WILL BE PROVIDED NECESSARY OPPORTUNITY OF BEING HEARD. 12.2 IN VIEW OF THE ABOVE APPEAL IN I.T.A.NO. 1592 /DEL/2011 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 13. IN I.T.A. NO. 1593/DEL/2011 THERE ARE COMMON I SSUES OF COMMISSION AND BED DEBTS WRITTEN OFF. IN THIS APPEAL ALSO TH E LD. CIT(A) HAS NOT ADDRESSED THE OBSERVATIONS RAISED BY A.O. WITH RESP ECT TO BAD DEBTS WRITTEN OFF. THE A.O. HAD OBSERVED AS UNDER: 4. DURING THE YEAR UNDER CONSIDERATION THE ASSESS EE HAS CLAIMED DOUBTFUL ADVANCE OF RS.9 69 903/- HENCE VIDE ORDER SHEET ENTRY DATED 12.11.2007 HE WAS REQUESTED TO EXPLAIN WHY THE DOU BTFUL ADVANCE MAY NOT BE DISALLOWED. IN RESPONSE TO THIS THE ASS ESSEE FURNISHED THE REPLY BUT HIS REPLY RELATES TO BAD-DEBT ONLY AND AS PER HIS OWN COMPUTATION. PROVISION OF DOUBTFUL DEBT AMOUNTING T O RS.5 OO 979/- MADE IN THE BOOKS OF ACCOUNT HAS BEEN ADDED HIMSELF IN THE COMPUTATION OF INCOME. IN THESE CIRCUMSTANCES IT I S QUITE CLEAR THAT ITA NOS.1592 & 2593/DEL/2011 9 THE ASSESSEE HAS NO EXPLANATION REGARDING DOUBTFUL ADVANCE AMOUNTING TO RS.9 69 903/- WHICH IS NOT ALLOWABLE AS DEDUCTION. HENCE THE SAME IS BEING ADDED TO THE INCOME OF THE ASSESSEE. ADDITION OF RS.9 69.903/-. 13.1 THEREFORE THIS ISSUE IS RESTORED TO LD. CIT(A ) FOR READJUDICATION. 14. AS REGARDS ISSUE OF COMMISSION WE FIND THAT AS SESSEE HAD SUBMITTED COMPLETE DETAILS OF COMMISSIONS PAID ON WHICH TDS W AS ALSO DEDUCTED. THESE DETAILS ARE PLACED AT PAPER BOOK PAGE 12 & 13 . THEREFORE FOLLOWING THE ORDER IN I.T.A. NO. 1592 WE DISMISS THIS GROUN D OF APPEAL. 15. IN VIEW OF THE ABOVE APPEAL IN I.T.A. NO. 1593 /DEL/2011 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 16. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST NOV. 2014. SD./- SD./- (H. S. SIDHU) (T.S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 21 ST NOV. 2014 SP COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)- NEW DELHI. 5. THE DR ITAT LOKNAYAK BHAWAN KHAN MARKET NEW DEL HI. TRUE COPY. BY ORDER (ITAT NEW DELHI). ITA NOS.1592 & 2593/DEL/2011 10 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR. PS/PS 6 KEPT FOR PRONOUNCEMENT SR. PS/PS 7 FILE SENT TO BENCH CLERK SR. PS/PS 8 DATE ON WHICH THE FILE GOES TO HEAD CLERK 9 DATE ON WHICH FILE GOES TO A.R. 10 DATE OF DISPATCH OF ORDER