Hybrid Financial Services Ltd. Vs ACIT (ITAT Mumbai)
ITAT Mumbai held that additional claim of deduction of bad debts under section 36(1)(vii) of the Income Tax Act filed during the course of assessment other than filing a revised return is allowable. Accordingly, appeal of the assessee allowed.
Facts- The assessee filed its return of income on 23.09.2014, reporting a loss of Rs. 1,16,70,751/-. Subsequently, assessee filed revised return of income on 29.09.2014 declaring Nil income and claiming the same loss as per the original return. During the course of assessment proceedings, assessee vide letter dated 10.08.2016 made a fresh claim for “Bad Debt Written off” amounting to Rs 6,17,28,003/-, which was not made in the original return of income so filed. AO disallowed the claim of bad debts with sole reasoning that assessee has sought to raise a fresh claim by submitting a revised computation which was originally not claimed in the return.
Conclusion- In the present case before us, there is no dispute on facts that bad debts have been written off. Thus, under the law, assessee is undisputedly eligible for the claim so made. The only hurdle created by the ld. Assessing Officer is on account of this claim not made by way of filing of revised return. Considering the facts on record, material placed before us, position of law as discussed above, claim of assessee is ought to be allowed, more particularly when there is no embargo applicable on the appellate authority to consider such claim as enunciated by the Hon’ble Apex Court in Goetz (India) Ltd. Accordingly, ground taken by the assessee is allowed.
