Income Tax Appellate Tribunal - Delhi
M/S. G.D. Builders, Delhi vs Acit, New Delhi on 31 August, 2020
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH 'C', NEW DELHI
Before Sh. Amit Shukla, Judicial Member
Dr. B. R. R. Kumar, Accountant Member
(E-Court Module)
ITA No. 6219/Del/2014 : Asstt. Year : 2010-11
M/s G. D. Builders, Vs Asstt. Commissioner of Income
201A, Apra Plazam, Plot No. 29, Tax, Circle-38(1),
Community Centre, Rani Bagh, New Delhi
Pitampura, Delhi-110034
(APPELLANT) (RESPONDENT)
PAN No. AAAFG2009B
Assessee by : Sh. Rajiv Saxena, Counsel
Revenue by : Sh. R. K. Gupta, Sr. DR
Date of Hearing: 03.08.2020 Date of Pronouncement: 31.08.2020
ORDER
Per Dr. B. R. R. Kumar, Accountant Member:
The present appeal has been filed by the assesse e against the order of the ld. CIT-XXVIII, New Delhi dated 10.09.2014.
2. Following grounds have been raised by the assessee:
"1. Th at th e ld. CIT (A) has g ro ssly erred in law an d on facts in upholding th e d isallowance of Rs.1 9,05,926 /- u/s 36 (1)(vii) of the Act. The ld. CIT (A) has arbitrarily brushed the submissions mad e and evidence furnished b y the assessee.
1.1 The fin ding that the amounts written o ff were not balances of debtors bu t constituted the security depo sit given to the contractees, wh ich have not b een refunded an d were not bad debts as defined u/s 36(1)(vii) of the Act, is wholly incorrect and i s based on totally mi sconceived facts.2 ITA No. 6219/Del/2014
G. D. Builders
2. That the further finding o f the ld. CIT (A) that inspite of repeating o pportunity, the assessee has failed to prove that th e amount claimed as bad deb ts h ave swelled the profit of an y year p receding to the year in question, i s wholl y in correct and has been arrived at firstly without ap preci ating th e facts and sub mission made and in any case withou t grantin g a fair and reasonable opportu nity. Th e ld. CIT (A) has disregarded th e facts th at th e amount claimed as b ad d ebts was part of sale proceed s o f the relevant year. In respect wh ereof the profit have duly been declared by the assessee.
3. Th at th e ld. CIT (A) has erred i n upholding the add ition of Rs.1,02,331/- made by th e AO on account of shattering charges of A.Y. 201 0-11 paid to M/s Preet Shuterin g Store on whi ch al legedly no TDS has been dedu cted. Th e ld. CIT (A) has arbitrarily ignored the facts th at assessee h ad deducted TDS while making paymen t to the aforesaid party as well as a cop y of Fo rm 16A in respect thereof filed b y th e assessee. Merely on the ground that AO has made the disallowan ce on the basis that no TDS was deducted.
4. That the ld. CIT (A) has erred in law and on facts in upholding the levy of in terest u/s 2 34B an d 234C."
Disallowance of Rs.19 lacs u/s 36(1)(vii):
3. The assessee debite d Rs.19.05 lacs on account of bad debts which was disallo wed by the Assessing Officer on the grounds that the amount of bad debt claimed must have been included in the income of the assessee in the earlier years. The AO held that the assessee could not prove that the amount of debt has bee n taken into account while computing taxable income in any previous year.
4. The ld. CIT (A) confirmed the addition made by the AO.
5. Heard the arguments of bo th the parties and perused the material available on reco rd.
3 ITA No. 6219/Del/2014G. D. Builders
6. We find that the bad debts claimed out of the contract receipt are as under:
1. Aman Resorts Pvt. Ltd. - Rs.15,29,518/-
2. Ansal Ho using & Construction Ltd. - Rs.2,01,203/-
3. MCD Staff Quarter - Rs.2,00,000/-
7. We find from the record before us, that the bad debts arose o ut of the contracts awarded in the assessment year 2005-06 and executed over a period of three years in the case of Aman Resorts Pvt. Ltd. In the case of Ansal Housing & Construction Ltd., the contract was awarded in the assessment year 2000-01 and executed upto asse ssment year 2003-04. Similarly, the contract was allotte d in the assessment year 1994-95 by the MCD and the work was completed in the assessment year 2000-01.
8. We have gone through the accounts of the relevant years filed before us with regard to the considering the amount of contracts received in the relevant years and find that the total contract receipt are part of the turnover of the assessee during the relevant years. Since, the bad debts of the amo unt which could not be recovered from the contractee and since the entire contract amount has been offered to tax, we hereby hold that the assessee is allowed to claim the debts unrecoverable under the head "bad debts".
Disallowanc e of Shuttering Expens es of Rs.1.02,331/-:
9. The assessee has made payment to one entity namely, M/s Preet Shuttering Store towards shuttering expenses. The AO disallowed an amount of Rs.1,02,331/- as no TDS was deducted 4 ITA No. 6219/Del/2014 G. D. Builders on the amounts paid. It was argued that the TDS has been duly deducted on the entire amounts paid to M/s Preet Shuttering Store. He argued that on the amount pertaining to only one bill no. 06 dated 30.04.2009 has not been deducted initially, howeve r if the entire transactio ns from M/s Preet Shuttering Store are considered, it can be found that the TDS has been deducted in entirety. He furthe r argued that the payee has already furnished the return by taking into account the sums and paid the taxes thereon. It was argued that the assessee is willing to furnish the certificate to that extent from the payee to the AO. Hence, keeping in view the facts canvassed by the assessee, the matter is remanded back to the AO to give the benefit of deduction of TDS on production of certificate from M/s Preet Shutte ring Store o r furnishing of reconciliation o f the TDS on the payments made to M/s Preet Shutte ring Store by the assessee.
10. In the result, the appeal of the assessee is partly allowed. Order Pronounced in the Open Court on 31 /08/2020.
Sd/- Sd/-
(Amit Shukla) (Dr. B. R. R. Kumar)
Judicial Member Accountant Member
Dated: 31/08/2020
*Subodh*
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
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