section 36(1)(vii) - Page 2

Bad Advance written off is allowable expense if it was given in the course of business

M/s. Summit Investments Ltd Vs J.C.I.T (ITAT Kolkata)

The brief facts of this issue is that the assessee advanced a sum of Rs. 2 crores on 20.5.1992 to Broker Shri.Pallav Sheth under portfolio management scheme. The said broker is supposed to manage the trading portfolio of shares and securities on behalf of the assessee....

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Employees' contribution to PF is eligible for Deduction U/s. 43B

ITO Vs Indore Steel and Iron Mills Ltd (ITAT Mumbai)

Whether the deposit by the assessee­ of the employee’s contribution to the Employees Provident Fund (EPF) or to the Employees State Insurance Corporation (ESIC), i.e., as an employer, after the respective due dates, i.e., under the respective Acts, where-under both the employee and the employer are obliged to contribute a sum, reckoned...

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Interest cannot be disallowed if huge interest free funds were available without any interest

ACIT Vs Gopal Fabrics (ITAT Ahmedabad)

Where huge funds were available without any interest liability with assessee and there was no evidence to hold that borrowed money was utilized for purpose of advance to sister concerns, no disallowance of interest was warranted. ...

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Will CBDT look into the following and allow Government to amend the tax law?

ection 55 (2)(b) of the Income Tax Act, 1961 provides the option to the assesse to consider the fair market value of capital assets as on the 1st day of April , 1981 as the cost of acquisition where the same were acquired before April 1, 1981. This base year has been in use since the last amendment made under the Finance Act, 1992. ...

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Posted Under: Income Tax |

Disallowance on account of bad debt & advances written off not justifed

M/s Pepsico India Holdings Private Limited Vs DCIT (ITAT Delhi)

Amount of advance given to M/s Dhillon Kool Drinks and Beverages Limited was advanced in the course of business. It is undisputed that the advances became irrecoverable. In such situation, as per the ratio emanating from the decision of the Hon'ble Jurisdictional High Court in the case...

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GRATUITY- direct cheque issued to LICI, allowed by CIT(A), ITAT, HC and confirmed by SC as contribution to Gratuity Fund

We find lot of complications and procedural delays in setting up and approval of gratuity funds. This can be simplified and any payment made for funding gratuity liability made to insurers like the Life Insurance Corporation of Indian can be allowed....

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Posted Under: Income Tax |

If assessee advanced to sister concerns or others without interest for no business purpose, interest to that extent to be disallowed

Sree Rayalaseema Green Energy Vs Deputy Commissioner of Income-tax (ITAT Hyderabad)

Once it is borne out from the record that the assessee had borrowed certain funds on which liability to pay tax is being incurred and on the other hand, certain amounts had been advanced to sister concerns or others without carrying any interest and without any business purpose, the interest to the extent the advance had been made without...

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Bad Debt is allowable irrespective of provision for bad and doubtful debts created by Bank -SC

Deputy Commissioner of Income tax Vs Karnataka Bank Ltd. (Supreme Court of India)

Deduction under section 36(1)(vii) is allowable independently and irrespective of provisions for bad and doubtful debts created by the assessee in relation to the advances of the rural branches, subject to the limitation that an amount should not be deducted twice under section 36(1)(vii) and 36(1)(viia )....

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Allowability of bad debts under section 36(1)(vii)

ACIT Vs Ashima Dye cot Pvt. Ltd. (ITAT Ahmedabad)

ACIT Vs Ashima Dye cot Pvt. Ltd. (ITAT Ahmedabad)- After the amendment of section 36(1)(vii) of the Income-tax Act, 1961, with effect from April 1, 1989, in order to obtain a deduction in relation to bad debts, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable: it is enough if the bad debt ...

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Loss of investment not allowable as business loss and for claiming an amount as bad debt conditions specified in section 36(2)(i) are required to be fulfilled

The Joint Commissioner of Income Tax Vs. M/s Video con Industries Ltd. (ITAT Mumbai)

JCIT Vs M/s Videocon Industries (ITAT Mumbai) - It is seen on perusal of the assessment records of assessment year 1999-2000 that the loss on sale of shares on SMS Pharmaceuticals has been declared as long term capital loss. This shows that the transaction in respect of the purchase and sale of shares of SMS Pharmaceuticals are nothing ...

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September 2021