The Tax Publishers2012 TaxPub(DT) 0320 (Mum-Trib) : (2011) 141 TTJ 0011

INCOME TAX ACT, 1961

--Business deduction under section 36(1)(vii)--Bad debtsForeign bad debts--Assessee had written off foreign bad debts and assessing officer disallowed assessee's claim on the ground that he had failed to submit evidences in nature of approval from RBI to write off the debt in foreign currency. Held: Not rightly so. Merely because the RBI's approval was not there, assessee's claim could not be denied. RBI's directives do not override the provisions of Income Tax Act. Assessee had also submitted the details such as full address of parties, resolution of the board regarding write off of foreign debts, bill-wise details of debts written off along with copy of relevant invoices to substantiate its claim.

Income Tax Act, 1961 Section 36(1)(vii)

 INCOME TAX ACT, 1961

--Business deduction under section 36(a)(vii)--Bad debtsBurden of proof--Assessee had written off sundry debtors and deduction for the same was claimed. The said claim was examined and disallowed by assessing officer on the basis that no evidences were furnished by assessee to prove the genuineness of the transaction. Held: Rightly so. The burden of proving the necessary facts to claim exemption was on assessee, but the necessary facts had not been established by him at any stage of the proceedings. Assessee had only advanced its claim but had not been able to substantiate its claim and, therefore, the same could not be allowed.

Income Tax Act, 1961 Section 36(1)(vii)

IN THE ITAT, MUMBAI 'E' BENCH

S.V. MEHROTRA, A.M. & VIJAY PAL RAO, J.M.

Sabra Impex Ltd. v. ITO

ITA No. 2210/Mum/2006

A.Y. 2002-03

31 March, 2011

Appellant by : G.P. Mehta,

SUBSCRIBE TaxPublishers.inSUBSCRIBE FOR FULL CONTENT

TaxPublishers.in

'Kedarnath', 7, Avadh Vihar, Near Nirali Dhani,

Chopasni Road

Jodhpur - 342 008 (Rajasthan) INDIA

Phones : 9785602619 (11 am - 5 pm)

E-Mail : mail@taxpublishers.in / mail.taxpublishers@gmail.com