Case Law Details
Amarnath Aggarwal Builders Pvt. Ltd. Vs DCIT (ITAT Amritsar)
ITAT Amritsar held that loss incurred as amount written off paid against advance of land reflected in column ‘bad & doubtful’ in ITR is allowable as business loss as genuinity of transaction not questioned.
Facts- The assessee is a company doing business promoting and development and the housing project. During the assessment proceedings, it was noticed that the assessee has debited Rs.1,10,00,000/- under the head ‘Amount written off paid against advance of land.’
The Revenue asked to explain the nature of expenses which was debited. It was submitted that the assessee along with other two other entities entered into an agreement dated 30.09.2005 with Sh. Nasib Singh, Man Singh, Rustam Singh, Harbhajan Singh, Gurdev Singh, Daulat Singh and Balwant Singh and certain other persons of village Kundi Tehsil & Distt. Panchkula for purchasing land measuring 98 Kanals 8 Marlas.
It was also stated that the assessee and other two entities paid Rs. 1,10,00,000/- out of which the assessee’s share is Rs.80 lacs, as earnest money against purchase of said land. Further, an amount of Rs.30 lacs was paid by the assessee-company to the Haryana Government for fee and etc.
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