PAGODA REALTORS PVT. LTD.,KOLKATA vs. D.C.I.T,CIRCLE-1(2), KOLKATA

by the assessee therein read as under: “1. That on the facts and in the circumstances of the case, the AO was wholly wrong and unjustified in not allowing the deduction claimed in respect of debts actually written off in the books of account amounting to Rs. 12,067/- and in view of the facts and in the circumstances the Ld. CIT(A) had grossly erred in confirming the said addition of the AO for the sum of Rs. 12,0671- debited by the appellant under the head sundry stock and balance written off without appreciating the fact that the same is fully allowable as business expenditure having been actually written off without appreciating the fact that the same is fully allowable as business expenditure having been actually written off in the books of account.

I have heard the arguments of both the sides and also perused the relevant material available on record. As regards issue involved in Ground No. 1, it is observed that the claim of the assessee for deduction of Rs. 12,607/- on account of sundry balances written off was disallowed by the AO on the ground that there was no evidence to show that the amount so written off was included in the income of the assessee for the year under consideration or for any earlier previous years. On appeal, the Ld. CIT(A) confirmed the said addition made by the AO. At the time of hearing before the Tribunal, the learned counsel for the assessee has submitted that the amount of Rs. 12,607/- in question represented difference relating to some parties and the reconciliation of the said difference filed by the assessee before the Ld. CIT(A) was not considered by him. He has also placed on record a copy of written submission claimed to be filed before the Ld. CIT(A) containing such reconciliation. It is however observed that the amount of Rs. 12,607/- written off by the assessee was disallowed by the AO for the specific reason that there was no evidence filed by the assessee to show that the said amount was considered as its income of the assessee either in the year under consideration or in any of the previous year so far. Even in the written submission stated to be filed before the Ld. CIT(A) as well as during the course of hearing before the Tribunal, nothing has been brought on record on behalf of the assessee to show that the amount of Rs. 12,607/- in question was considered as its income either in the year under consideration or in any of the previous years. It is thus clear that the condition stipulated in section 36(1)(vii) is not satisfied by the assessee and the deduction claimed by the assessee on account of Assessment Year: 2013-14 Pagoda Realtors Pvt. Ltd.

As regard the issue involved in Ground No. 2, it is observed that the Ld. CIT(A) in his impugned order has specifically directed the AO to allow the claim of the assessee for credit on account of advance tax of Rs. 19,00,000/- paid by the assessee after proper verification. The learned counsel for the assessee has submitted that the Assessing Officer however has not complied with this direction of the Ld. CIT(A) and the credit for the advance tax has not been given by him so far. I, therefore, direct the AO to verify the claim of the assessee on account of advance tax paid and allow credit as claimed by the assessee on such verification. Ground No. 2 is accordingly treated as allowed for statistical purpose.

In the result, the appeal of the assessee is partly allowed for statistical purpose.