THE INDIAN STEEL & WIRE PRODUCTS LTD.,KOLKATA vs. D.C.I.T., CIRCLE-1(2), KOLKATA, KOLKATA

- This assessee’s appeal for assessment year 2011-12 arises against Commissioner of Income Tax (Appeals)-1, Kolkata’s order dated 29.08.2016 passed in case No.147/citaaaa-1/Cir-1(2)/2014-15, involving proceedings u/s 143(3) of the Income Tax Act, 1961; in short ‘the Act’.

The assessee’s sole substantive grievance pleaded in the instant appeal challenges of correctness of both the lower authorities action disallowing its asset written off claim amounting to ₹17,06,434/-. The CIT(A)’s discussion on the instant issue reads as follows:- “Ground No.4: This ground relates to the disallowance of an amount of Rs.17,06,434/-- by the AO under the Assets written off The AO has dealt with this issue in the assessment order as under: Assets written off. The assessee company in its P//L. A/c debited an amount of Rs.17,06,434/- under head operation and other expenses’ sub head ‘assets written off.’ The assessee was asked submit the details of assets The Indian Steel & Wire Products Ltd vs. DCIT, Cir-1(2), Kol. Page 2 written of with evidence. The A/R appeared on 21.03.2014 but failed to submit any detail and supporting evidence in this regard. Thus, the said amount of Rs.1706433.87/- is liable to be disallowed being capital loss in absence of supporting documents and added back to the total income of the assessee.” The appellant’s AR has made written submissions as under: “The asset were declared as scrap and written off in P/L account of Rs.17,06,434/-. Same has been appeared in P/L account included in scrap sale in refer Schedule 3 forming part of P/L account. Hence debit and credit both accounted for during the year and auditor accepted the same accounting.” I have considered the material before me. The AO held that the appellant’s AR was unable to submit any details and supporting evidence to substantiate the amount of Rs.17,06,434/- written-off a under head, “Operation and Other Expenses.”The appellant’s AR in the written submission has claimed that the asset written off” pertained to the assets scrapped, which was reflected in Schedule 3 to the Profit & Loss account. Its found that the appellant was unable to discharge its onus to substantiate its claim either during the assessment or appellate proceedings and has reiterated the earlier contentions. In view thereof, I am of the opinion that there is no infirmity in the finding of the AO. Therefore, the disallowance made by the AO of Rs.17,06,434/- is confirmed. This ground is not allowed.”