Case Law Details
DCIT Vs Amri Hospitals Ltd (ITAT Kolkata)
ITAT Kolkata held that advance given in relation to business transaction for setting up hospital project which was abandoned, the said advance is irrecoverable and hence allowable as revenue expenditure.
Facts-
AO observed that the assessee has claimed expenditure of Rs. 10,87,28,000/- on account of compensation paid to Mr. Kunal Saha as per the directions of the Hon’ble Supreme Court of India vide order dated 24.10.2013 for the negligence on the part of the hospital in providing proper treatment of Late Anuradha Saha. The said compensation was claimed as an expenditure by the assessee company.
AO was of the considered view that the said compensation cannot be allowed as an expenditure on account of two reasons; firstly, the said amount is in nature of the penalty and therefore, disallowable u/s 37(1) of the Act and secondly, the said amount is not of revenue in nature but a capital expense. Ld. AO also made disallowance of excess depreciation of Rs. 38,98,013/-, disallowance of advance written off of Rs. 4,41,000/-, treating of house property income as income from other sources and minor other additions. Loss assessed at Rs. 54,49,56,416/-.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
