Suncem Surface Coatings Pvt.Ltd.,, Ankleshwar v. The Income tax Officer,Ward-4,, Bharuch

ITA 2431/AHD/2009 | 2006-2007
Pronouncement Date: 01-03-2011 | Result: Partly Allowed

Appeal Details

RSA Number 243120514 RSA 2009
Assessee PAN AADCS2892Q
Bench Ahmedabad
Appeal Number ITA 2431/AHD/2009
Duration Of Justice 1 year(s) 6 month(s) 15 day(s)
Appellant Suncem Surface Coatings Pvt.Ltd.,, Ankleshwar
Respondent The Income tax Officer,Ward-4,, Bharuch
Appeal Type Income Tax Appeal
Pronouncement Date 01-03-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted B
Tribunal Order Date 01-03-2011
Date Of Final Hearing 01-03-2011
Next Hearing Date 01-03-2011
Assessment Year 2006-2007
Appeal Filed On 17-08-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'B' BEFORE SHRI D K TYAGI JM & SHRI A N PAHUJA AM ITA NO.2431/AHD/2009 (ASSESSMENT YEAR:-2006-07) SUNCEM SURFACE COATINGS PVT. LTD. A-1/168 GIDC INDUSTRIAL ESTATE GIDC ANKLESHWAR V/S INCOME-TAX OFFICER WARD- 4 BANK OF BARODA BUILDING STATION ROAD BHARUCH PAN: AADCS 2892 Q [APPELLANT] [RESPONDENT] ASSESSEE BY :- SHRI DHIRESH T SHAH AR REVENUE BY:- SHRI P R GHOSH DR O R D E R A N PAHUJA: THIS APPEAL BY THE ASSESSEE AGAINST AN ORDER DATE D 04-06-2009 OF THE LD. CIT(APPEALS)-VI BARODA FOR THE ASSESSMENT YEAR (AY) 2006-07 RAISES THE FOLLOWING GROUNDS:- 1 THE LEARNED ITO HAS ERRED IN MAKING AN ADDITION FOR A TOTAL OF RS.3 85 157/- IN RESPECT OF BAD DEBTS WRITTEN OFF F OR THREE PARTIES EVEN THOUGH APPELLANT HAD SUBMITTED SUFFICIENT SUPPORTIN G AND RELEVANT FACTS DURING THE COURSE OF PROCEEDINGS INITIATED U/S 143( 2) AND THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE SAME. 2 THE LEARNED ITO HAS ERRED IN MAKING A DISALLOWANC E IN RESPECT OF PAYMENT MADE OF RS.66 456/- FOR SECURITY CHARGES ON ACCOUNT OF PAYMENT MADE WITHOUT DEDUCTING TAX AT SOURCE AND TH E LEARNED CIT(A) HAS ERRED IN CONFIRMING THE SAME. 3 THE APPELLANT CRAVES TO ALTER AND / OR MODIFY AND / OR DELETE AND / OR AMEND THE ABOVE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING . 2 ADVERTING FIRST TO GROUND NO.1 IN THE APPEAL FAC TS IN BRIEF AS PER RELEVANT ORDERS ARE THAT RETURN DECLARING INCOM E OF RS.2 68 075/- FILED ON 22-1-2007 BY THE ASSESSEE MANUFACTURING D ECORATIVE PAINTS WAS SELECTED FOR SCRUTINY WITH THE ISSUE OF A NOTICE U/S 143(2) OF THE INCOME-TAX ACT 1961 [HEREINAFTER REFERRED T O AS THE ACT] ON 3.10.2007. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS THE ITA N O.2431/AHD/2009 2 ASSESSING OFFICER[AO IN SHORT] NOTICED THAT THE AS SESSEE COMPANY HAD WRITTEN OFF FOLLOWING DEBTS AGGREGATING TO RS.3 85 157/- :- (I) M/S UNIQUE MARKETING ASSOCIATES CHENNAI RS.1 54 752 (II) DILESH ENTERPRISE MUMBAI RS.1 11 570 (III) NE-TAN AND SERVICES BELGAUM RS.1 18 835 ---------------- RS.3 85 157 THE AO DISALLOWED THE CLAIM ON THE GROUND THAT THE ASSESSEE DID NOT EXPLAIN THE CIRCUMSTANCES UNDER WHICH THE DEBTS WE RE WRITTEN OFF NOR STATED THE VARIOUS STEPS TAKEN FOR THE RECOVERY OF THESE DEBT S. 3. ON APPEAL THE LEARNED CIT(A) UPHELD THE ACTION OF THE AO ON THE GROUND THAT EVEN THOUGH BAD DEBTS HAD BEEN WRIT TEN OFF IN THE BOOKS OF ACCOUNT NO DETAILS WERE SUBMITTED TO SH OW THAT THE DEBTS HAD INDEED BECOME BAD. 4. THE ASSESSEE IS NOW IN APPEAL BEFORE US AGAIN ST THE AFORESAID FINDINGS OF THE LD. CIT(A).BOTH THE PARTIES AGREED THAT THE IS SUE IS SQUARELY COVERED BY THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF TR F LTD. VS. CIT 323 ITR 397 (SC). 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE AS ALSO THE DECISION RELIED UPON. WE FIND THAT THE HON'BLE SUPREME COURT IN THE CASE OF TRF LIMITED VS. CIT 32 3 ITR 397 (SC) WHILE ADJUDICATING A SIMILAR CLAIM CONCLUDED AS UND ER: THIS POSITION IN LAW IS WELL-SETTLED. AFTER 1ST A PRIL 1989 IT IS NOT NECESSARY FOR THE ASSESSEE TO ESTABLISH THAT THE DEBT IN FAC T HAS BECOME IRRECOVERABLE. IT IS ENOUGH IF THE BAD DEBT IS WRITTEN OFF AS IRRECOV ERABLE IN THE ACCOUNTS OF THE ASSESSEE... 5.1. IN THE LIGHT OF VIEW TAKEN BY THE HONBLE APE X COURT IN THEIR AFORESAID DECISION IN TRF LTD.(SUPRA) AND INDISPUTA BLY DEBTS HAVING BEEN WRITTEN OFF IN THE BOOKS OF ACCOUNTS APPAREN TLY THE AMOUNT OF RS. 3 85 157/- IS ADMISSIBLE DEDUCTION IN TERMS OF PROV ISIONS OF SEC. 36(1)(VII) R.W.S. 36(2) OF THE ACT. THEREFORE GROUND NO.1 IS ALLOW ED . ITA N O.2431/AHD/2009 3 6. GROUND NO.2 RELATING TO DISALLOWANCE OF RS.66 45 6/- ON ACCOUNT OF SECURITY CHARGES U/S 40A(IA) OF THE ACT WAS NOT PRESSED BEFORE US BY THE LEARNED AR ON BEHALF OF THE ASSESSEE. THEREF ORE THIS GROUND IS DISMISSED AS SUCH. 7. NO ADDITIONAL GROUND HAVING BEEN RAISED IN TER MS OF THE RESIDUARY GROUND NO. 3 IN THE APPEAL ACCORDINGLY THIS GROUND IS ALSO DISMISSED. 8. NO OTHER PLEA OR ARGUMENT WAS MADE BEFORE US. 9 IN THE RESULT APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT TODAY ON 1-3-2011 SD/- SD/- (D K TYAGI) JUDICIAL MEMBER (A N PAHUJA) ACCOUNTANT MEMBER DATED : 1-3-2011 COPY OF THE ORDER FORWARDED TO: 1. SUNCEM SURFACE COATINGS PVT. LTD. A-1/168 GIDC INDUSTRIAL ESTATE GIDC ANKLESHWAR 2. ITO WARD-4 BHARUCH 3. CIT CONCERNED 4. CIT(A)-VI BARODA 5. DR ITAT AHMEDABAD BENCH-B AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD