Case Law Details
Maharashtra Film Stage and Cultural Development Corporation Ltd. Vs ACIT (ITAT Mumbai)
The assessee had written off the bad debt as per the Board Resolution dt.5.6.2009 after the closing of books of accounts. The Assessing Officer had disallowed the claim on the ground that books of accounts were closed on 31.3.2009 whereas bad debts were written off as per Board Resolution dt.5.6.2009. The ld. CIT(A) had dismissed the appeal of the assessee stating that decision of writing off of bad debts was taken much later on after closing of books of accounts. During the course of appellate proceedings before us the assessee had neither made any compliance nor furnished any material to disprove the findings of the authorities below, therefore we do not find any error in the decision of ld. CIT(A). Accordingly, this ground of appeal of the assessee stands dismissed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals)-3, Mumbai Dt.26.12.2011 for the Assessment Year 2009-10.
2. This case was listed for hearing for a number of times. The same was adjourned because of seeking frequent adjournments by the assessee or because of not attending on behalf of assessee. Therefore the appeal of the assessee is decided after hearing the learned Department Representative and taking into consideration the material placed on record.
3. The facts in brief are that the Return of Income declaring loss of Rs.11,15,88,425 was filed on 30.09.2009. The Return of Income was revised on 26.09.2010 declaring total loss of Rs.30,59,943. Further relevant facts are discussed while adjudicating the grounds of appeal filed by the assessee.
4. Ground No.1 is regarding confirming the advance
written off amounting to Rs.10,07,37,891.
4.1 During the course of assessment, the Assessing Officer noticed that the assessee had finalised its accounts on 31.03.2009 for the purpose of filing of Return of Income. The assessee has decided to write off certain advances to the amount of Rs.1,00,31,891 as on 18.05.2010. The Assessing Officer observed that as on 31.3.2009, the assessee had finalised accounts on the basis of audit report subsequently on the basis of Board Resolution dt.18.5.2010 the advances were written off and same was not allowable since the accounts of the assessee for the financial year under consideration were closed on 31.3.2009.
4.2 The ld. CIT(A) held that books of account of the assessee has been audited under the provisions of section 44AB of the Act along with report in Form No.3CA / 3CB which mean the account of the assessee was closed on 31.3.2009, therefore writing off on the basis of Board Resolution dt.18.5.2010 cannot be considered as allowable.
4.3 However, during the course of appellate proceedings before us neither the assessee attended nor furnished any relevant material to prove contrary to the findings of the ld. CIT(A), therefore this ground of appeal of the assessee stands dismissed.
5. Ground No.2 relates to confirming of bad debts to the extent of Rs.1,14,03,962.
5.1 The assessee had written off the bad debt as per the Board Resolution dt.5.6.2009 after the closing of books of accounts. The Assessing Officer had disallowed the claim on the ground that books of accounts were closed on 31.3.2009 whereas bad debts were written off as per Board Resolution dt.5.6.2009. The ld. CIT(A) had dismissed the appeal of the assessee stating that decision of writing off of bad debts was taken much later on after closing of books of accounts. During the course of appellate proceedings before us the assessee had neither made any compliance nor furnished any material to disprove the findings of the authorities below, therefore we do not find any error in the decision of ld. CIT(A). Accordingly, this ground of appeal of the assessee stands dismissed.
6. Ground No.3 relates to confirming the leave encashment of Rs.1,77,449.
6.1 The Assessing Officer noticed that the assessee has paid leave encashment liability which was predetermined at the beginning of the year at Rs.12,33,904. However, the assessee claimed deduction of Rs.14,11,353/-, therefore the Assessing Officer had disallowed the difference being excess claim of Rs.1,77,449. The ld. CIT(A) has dismissed the ground of appeal of the assessee reiterating the facts reported by the Assessing Officer. During the appellate proceedings before us, the assessee had not made any compliance to prove contrary to the finding of ld. CIT(A), therefore, this ground of appeal of the assessee stands dismissed.
7. Ground No.4 relates to depreciation of Rs.19,067.
7.1 During the assessment, the Assessing Officer noticed that depreciation as per I.T. Return as reported in the Audit Report was Rs.1,24,44,513 whereas the assessee claimed it in the computation of income at Rs.1,24,63,580. Therefore difference of Rs.19,067 was disallowed. Neither before the ld. CIT(A) nor before us the assessee has produced any material in support of this claim of depreciation, therefore, this ground of appeal of the assessee stands dismissed.
8. Ground No.5 is regarding confirming the disallowance of Rs.14,62,000 as per provisions of section 40A(3) of the Act.
8.1 During the course of assessment the Assessing Officer noticed from the details as per clause 17(b)(A) of the tax audit report that assessee had made payment exceeding Rs.20,000 against the provision of section 40A(3) of the Act. Therefore, the Assessing Officer made addition of Rs.14,62,000 u/s.40A(3) for making payment of Rs.20,000 otherwise than account payee cheque. Aggrieved the assessee filed an appeal before the ld. CIT(A). However, the ld. CIT(A) restricted such disallowance to the amount of Rs.4,62,000 by deleting the amount of Rs.10 lakhs pertains to advance which was wrongly mentioned by the tax Auditor covered under section 40A(3) of the Act. Since the assessee has not produced any material in support of its claim therefore this ground of appeal stand dismissed.
9. Ground No.6 relates to addition of Rs.17,59,687 on account of difference in the profit.
9.1 The Assessing Officer noticed that the assessee filed two different profit and loss accounts for the year under consideration. In the first profit and loss account income was reflected at Rs.10,58,68,803 whereas in the second profit and loss account, the income was reflected at Rs.10,76,28,490. The Assessing Officer stated that no supporting evidence has been furnished. Therefore, maximum of the income shown was taken and difference of Rs.17,59,687 was added to the total income of the assessee. The ld. CIT(A) held that original Return of Income was duly audited as per the provisions of section 44AB of the Act which accompanied with Form No.3CA/3CB, therefore difference on reduction of income after completion of financial year was not acceptable. The assessee has not produced any material to disprove the fact reiterated by the ld. CIT(A), therefore, this ground of the assessee is dismissed.
10. In the result, the appeal of the assessee is dismissed.
Order pronounced in the open Court on 15th July, 2022.
