The Tax Publishers2021 TaxPub(DT) 4164 (Kol-Trib)

INCOME TAX ACT, 1961

Section 115JB

Since it was actual write-off of bad debts by assessee in its books, and not provision for doubtful debts as erroneously noted by AO invoking clause (c) or clause (i) of Explanation (1) to sub-section (2) of section 115JB did not get attracted and, therefore, no addition was called for.

MAT - Computation of book profit - Actual write-off of bad debts considered as provision for doubtful debts -

AO made addition of Rs. 94 lakhs on account of 'provision for bad and doubtful debts' in computation of book profit under section 115JB. Assessee contended that it had debited in its books of account to the tune of Rs. 94 lakhs as 'provision for bad and doubtful debts' which was an actual written-off of bad debts. Held: Since it was actual write-off of bad debts by assessee in its books, and not provision for doubtful debts as erroneously noted by AO invoking clause (c) or clause (i) of Explanation (1) to sub-section (2) of section 115JB did not get attracted and, therefore, no addition was called for.

Relied:Dy. CIT v. Peerless General Finance & Investments Co. Ltd. ITA No. 50/Kol/2009 for assessment year 2002-03, dated 3-12-020 : 2020 TaxPub(DT) 5300 (Kol-Trib).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2009-10



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