Itta/186/2013 Of Commissioner Of Income Tax-Ii v. M/S.inventa Chemicals Ltd

THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA AND THE HON’BLE Ms. JUSTICE G. ROHINI INCOME TAX TRIBUNAL APPEAL NO.186 OF 2013 DATED:3.7.2013 Between:Commissioner of Income Tax-IIHyderabad … PetitionerAndM/s. Inventa Chemicals Ltd.,10-91, SowbhagyanagarOpp. IDPL ColonyHyderabad … Respondent THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA AND THE HON’BLE Ms. JUSTICE G. ROHINI I.T.T.A. NO.186 OF 2013 JUDGMENT:(per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is sought to be admitted on the following suggestedquestions of law. (A)“Whether on the facts and in the circumstances of the case, theAppellate Tribunal is justified in holding that the unrecoveredamount of Rs.4.85 crores advanced by the assessee to thesupplier of the goods can be permitted to be deducted asmanufacturing expenses by charging to profit and loss account?Appellate Tribunal is justified in holding that the unrecoveredamount of Rs.4.85 crores advanced by the assessee to thesupplier of the goods can be permitted to be deducted asmanufacturing expenses by charging to profit and loss account? (B)Whether on the facts and in the circumstances of the case, theclaim of the assessee of having advanced Rs.4.85 crores tosecure insignificant job work of Rs.85.00 lakhs can be said to bebona fide?claim of the assessee of having advanced Rs.4.85 crores tosecure insignificant job work of Rs.85.00 lakhs can be said to bebona fide? (C)Whether on the facts and in the circumstances of the case, theAppellate Tribunal is justified in not holding that the unrecoveredamount was written off by the assessee in pursuance of schemeformulated by BIFR in the context of takeover of the subject unit,the amount so written off partakes the character of capital innature and hence cannot be permitted to be deducted as revenueexpenditure?Appellate Tribunal is justified in not holding that the unrecoveredamount was written off by the assessee in pursuance of schemeformulated by BIFR in the context of takeover of the subject unit,the amount so written off partakes the character of capital innature and hence cannot be permitted to be deducted as revenueexpenditure? This appeal is sought to be preferred against the judgment andorder of the learned Tribunal dt.10.7.2009, in relation to assessmentyear 2001-02. We have heard the learned counsel for the appellant and gonethrough the impugned judgment and order. It appears that the learned Tribunal deleted the addition of theadvance amount given to another company for supply of raw-materials,since the said company, by an order of the Board for Industrial and Financial Reconstruction (BIFR), was no longer in existence and theamount of advance given for supply of raw-materials became doubtfulfor recovery. Therefore, in the books of account it was shown aswritten off. This account cannot be questioned later by any authority. Once it is shown in the books of account as written off, it cannot bedoubted under any circumstances, unless it is shown that the same issubsequently recovered. The learned Tribunal dealt with purequestion of fact and no element of law is involved in this matter. The appeal is accordingly dismissed. No order as to costs. ________________________ K.J. SENGUPTA, CJ ______________________ G. ROHINI, J 3.7.2013 bnr