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Kiran Corpn. Vs. Assistant Commissioner of

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (2006)98ITD119(Ahd.)

..... the reasons behind amendment of provisions of section 143(1) w.e.f.1-4-1988 by the finance act, 1987 have been explained in circular no.549, dated 31-10-1989 of the cbdt as follows : 5.2 requirement of passing an assessment order in all cases dispensed with [sub-section (1) ..... off in accordance with the explanation below section 36(1)(vii) and the claim of deduction was not allowed by-assessing officer keeping in view the explanation below section 36(1)(vii) inserted by the finance act, 2001 with effect from 1-4-1989 which provides that any provision for bad and doubtful debt would not qualify as permissible deduction under section 37(1)(vii) of the income-tax ..... off in accordance with the explanation below section 36(1)(vii) and the claim of deduction was not allowed by assessing officer keeping in view the explanation below section 36(1)(vii) inserted by the finance act, 2001 with effect from 1-4-1989 which provides that any provision for bad and doubtful debt would not qualify as permissible deduction under section 37(1)(vii) of the income-tax ..... section 143(1)(a) as amended by the finance act, 1987 w.e.f. ..... bad debt reserve account, the necessary conditions for write off as contained under section 36(1)(vii) would be treated as complied with.however, explanation has been inserted below section 36(1)(vii) by the finance act, 2001 with effect from 1-4-1989 which provides that any provision for bad and doubtful debt would not qualify as permissible deduction under section 36(1)(vii). .....

Kiran Corporation Vs. the Asstt. C.i.T.

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (2006)102TTJ(Ahd.)375

..... behind amendment of provisions of section 143(1) w.e.f.1.4.88 by the finance act, 1987 have been explained in circular no. ..... of section 143(1)(a) as amended by the finance act, 1987 w.e.f. ..... in so far as this ground is concerned, we have already held that in view of explanation inserted below section 36(1)(vii) by the finance act, 2001 with effect from 1-4-81, the claim of bad debt can be allowed only if the debt is written off by passing entries in the accounts of ..... the court after making a reference to the amended provisions of section 143(1a) by the finance act, 1993 w.e.f.1.4.89 held as follows: the substituted sub-section (1a), therefore, made it clear that even where the loss declared by an assessee had been reduced by reason of adjustments made under sub-section (1)(a), the provisions of sub- ..... of levy of additional tax in the context of the provisions as it existed prior to its retrospective amendment by finance act, 1993 w.e.f 1.4.89, had come for consideration before the hon'ble supreme court. ..... keeping in view the explanation below section 36(1)(vii) inserted by the finance act 2001 with effect from 1-4-89 which provides that any provision for bad and doubtful debt would not qualify as permissible deduction under section 37(1)(vii) of ..... keeping in view the explanation below section 36(1)(vii) inserted by the finance act 2001 with effect from 1.4.1989 which provides that any provision for bad and doubtful debt would not qualify as permissible deduction under section 37(1)(vii) of .....

Chandulal Venichand Vs. Income Tax Officer

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (1991)38ITD138(Ahd.)

..... by which explanation 2 was inserted with retrospective effect from assessment year 1984-85 it was expressly mentioned that the proviso which was introduced by the finance act, 1987 was intended to remove hardship caused to certain taxpayers who had represented that since the sales-tax for the last quarter cannot be paid within that previous year, the ..... union of india [1988] 173 itr 708 that in order to apply the provision of section 43b (as it stood prior to amendments by finance act, 1987 and finance act, 1989) not only should the liability to pay the tax be incurred in the accounting year but the amount also should be statutorily "payable" in the accounting ..... it has been held by patna high court that under the proviso which was inserted with effect from 1-4-1988 by the finance act, 1987, the words "actually paid" occurring in the main section 43b have in fact been interpreted and as such the said proviso should be regarded as an interpretation clause or a clause which explains what is meant by ..... the said proviso was literally interpreted it would be struck down as it provided for doing an impossible act and that it could be upheld by holding that an assessee for the assessment year 1984-85 was entitled to have the benefit of the proviso introduced by the finance act, 1987.the high court held that upon textual interpretation of statutes, the proviso to section 43b of the act should be construed as retrospective in its operation and explanation 2 thereto should be held to be .....

Ajar Entrade (P) Ltd. Vs. Asstt. Cit

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (2005)2SOT571(Ahd.)

..... is pertinent to note that the provisions of section 36(1)(vii) have been amended by the finance act, 1987 with effect from 1-4-1989. ..... any bad debts or part thereof which is written off as irrevocable in the accounts of the assessee for the previous year" have been inserted by the amendment brought in' by finance act, 1987. ..... we, therefore, do not find any merits in the action of the lower authorities for declining the assessee's claim for bad debts in respect of money advanced in the course of its money-lending business, the financing income arisen out of which have already been found and accepted by the department to be credited to the profit & loss account as its business income in the earlier years and offered for taxation.going to ..... , the assessee was compelled to write off of amount for which proper entry was passed in the books of account, which is pre-requisite for claiming deduction under section 36(1)(vii) of the income tax act.on the other hand, the learned departmental representative vehemently argued that the lower authorities were justified in disallowing assessee's claim for bad debts, insofar as the deduction claimed under section 36(1)(vii) is subject to ..... in respect of these observations of the assessing officer, the cit(a) hold that the department has accepted the financing activity in the assessee's case and has taxed the financial charges as business income in the past.however, ultimately, the cit(a) has confirmed the disallowance on the plea that during the .....

Orient Trading Co. Vs. Income-tax Officer

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (1993)44ITD300(Ahd.)

..... he contended that the outstanding payment was paid before the prescribed date for furnishing the return under section 139(1) and therefore the same by first proviso to section 43b which provision was inserted by finance act 1987 merely as a declaration and therefore having a retrospective effect in view of the ahmedabad bench decision of the tribunal in the case of lokhandwala and the three decisions of patna high court, calcutta high ..... 43b are clear and provides for deduction of tax only on actual payment basis.the first proviso to section 43 was inserted by finance act 1987 and was made applicable specifically with effect from 1-4-1988 and not from 1-4-1987 a normal date for application of any provisions by the finance act, 1987, the legislative mandate is that it was not retrospective but only prospective. ..... brought in by finance act 1987 but with effect ..... the name of the principal was not intimated to the sales tax authority and therefore the liability to sales tax was that of the assessee under the gujarat sales tax act and the assessee was liable to account for the receipts thereon as its trading receipts in view of the supreme court decision in the case of kedarnathjute mfg. co. ..... in these circumstances in our opinion though the assessee was jointly and severally liable under the gujarat sales tax act, the sales tax collected would not form part of the assessee's trading receipts and consequently not even the expenditure.in fact the assessee had not claimed the expenditure .....

Smartchem Technologies Ltd. Vs. Income Tax Officer

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (2005)97TTJ(Ahd.)818

..... . further, the finance act, 1987, inserted two provisos before the explanation to section 43b w.e.f ..... . (2005) 93 ttj (del) 144 : (2005) 92 itd 1 (del) has held that since introduction of second proviso to section 43b of the act, had been held to be retrospective in nature, its omission by the finance act, 2003, is also retrospective and will be deemed to be with effect from the date of introduction of this proviso itself, and has further held that the payments covered by that proviso will be allowed if the same have ..... ." 40.2 it was in view of above facts, the tribunal (supra) held as under : "the finance act, 2003, has deleted the second proviso and amended the first proviso to section 43b with effect from asst. yr ..... ., 1983 giving explanatory notes in respect of amendments made in finance act, 1983, stating the intention of the introduction of section 43b in the it act : "several cases have come to notice where taxpayers do not discharge their statutory liability such as in respect of excise duty, employer's contribution to provident fund, employee's state insurance scheme, etc ..... (i) the appellant invited our attention to the explanatory memorandum to the finance act, 1998, for making an amendment in section 32 thereby allowing depreciation to be claimed in case of intangible assets. ..... . further, in case the amendment is not accepted to be operative retrospectively, then the amendment, so brought into statute by the finance act, 2003, would produce inequitable and illogical result .....

income-tax Officer Vs. K. S. Lokhandwala

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (1989)31ITD305(Ahd.)

..... in the ascertainment of meaning, everything which is logically relevant should be admissible.in view of the aforesaid discussions we are of the considered opinion that the first proviso to section 43b, which was inserted by the finance act, 1987 to obviate unnecessary disallowance of the amount of sales tax for the last quarter is merely a declaratory provision which was inserted to clarify the real legislative intention should be held to be applicable since the introduction ..... that the original provisions of section 43b may involve unnecessary disallowance of the payment of sales tax for last quarter, they inserted the above referred first proviso by the finance act, 1987, with the specific object to remove such cases where government dues like sales tax liability is paid before the time limit prescribed for submission of the return under section ..... the provisions of section 43b were inserted.4.1 he further submitted that the aforesaid real legislative intention is apparent from the fact that the first proviso was added in section 43b by the finance act, 1987 clearly providing that in case the amount of any such government dues or tax is paid before the due date for furnishing the return of income under section 139(1), no disallowance shall ..... section 43b may not result in unnecessary disallowance of the payment of sales-tax for the last quarter, the finance act, 1987, inserted the above referred proviso to section 43b to obviate any unintended hardship likely to be caused to the .....

Gujarat Petrosynthese Ltd. Vs. Deputy Commissioner of

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (2001)76ITD257(Ahd.)

..... an independent chapter xii-b in the income-tax act by the finance act, 1987 and it came into force from assessment year 1988 ..... it appears, that under the new scheme introduced by the finance act, 1997, the concept of lax credit has been brought ..... sub-section (1) of section 115j which reads as under : section 115j(1) : notwithstanding anything contained in any other provision of this act, where in the case of an assessee being a company (other than a company engaged in the business of generation or distribution of electricity), the total income, as computed under this act in respect of any previous year relevant to the assessment year commencing on or after the 1st day of april, 1988 (but before ..... under the scheme of above section which is a self contained provision, certain companies whose total income as computed under the provisions of the income-tax act, is less than 30 per cent of their book profits, the tolal income of such companies chargeable to income-tax for the relevant previous year is treated as an amount equal to 30 ..... pointed out that the depreciation on fixed assets was calculated on straight line method at the rates prescribed in schedule xiv of the companies act except for vehicles for which the company has revised the rate of depreciation during the year to 30 per cent. ..... adopted the figures of carried forward depreciation under section 32(2), of the income-tax act, and carried forward the following amounts :(1) unabsorbed depreciation for assessment year 1987-88 rs. .....

Shri Vijaysinh R. Rathod and ors. Vs. Ito

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

..... by the finance act, 1987, with effect from april i, 1988, the amendment to section 55 of the act only ropes in taxability of goodwill on transfer of the same even if there is no cost of acquisition. ..... capital gains on sale of such property where neither date of acquisition nor cost of land was ascertainable, cannot be brought to tax under head "capital gains" with the following observations: though section 45 of the income-tax act, 1961, is a charging section the legislature has enacted detailed provisions in order to compute the profits or gains under that head and no provision at variance with such computation provisions can be applied for determining the chargeable ..... . these rights would be then held by the assessees as inherited from the fore-fathers and the cost of acquisition in the hands of the assessees would be that of the fore-fathers by virtue of section 49(1)(iii)(a) of the act providing that where capital assets become property of the assessee by succession, inheritance or devolution, cost of acquisition of the assets deemed to be the cost of which the previous owner of the property acquired ..... hon'ble supreme court has emphasized broader scope of right of ownership and in instant cases assessees by express provisions of land reforms regulation act were granted lands which they were able to alienate with due permission - there were having unhindered possession, exploiting usufruct and enjoying the property, were owners for all practical purposes.15. .....

income-tax Officer Vs. Ashokkumar Lalitkumar

Court : Income Tax Appellate Tribunal ITAT Ahmedabad

Reported in : (1995)53ITD326(Ahd.)

..... want to spend good money for bad money, as recovery thereof had a remote chance and was not possible in this case.he also placed reliance on the conditions mentioned in section 36(2) as amended by the finance act 1987 which, inter alia, provides that the year in which the assessee has written off the debt as bad debt in the books of accounts should be considered as satisfying the claim for grant of deduction as ..... , the distinction between the nature of the claim of deduction as to whether it is a trading loss or it is a bad debt contemplated in section 36(2) has assumed significance in view of the amendment of section 36(2) made by the finance act, 1987 effective from assessment year 1989-90. ..... as a trading loss under section 28(1) and/or under section 37 of income-tax act, 1961 has not been taken into consideration by the lower authorities the conditions relating to grant of deduction as a bad debt and a trading loss has undergone a significant change by an amendment of section 36(l)(vii) and section 36(2) made by the direct tax law (amendment) act, 1989 with effect from 1-4-1989 which is applicable from assessment year 1989-90. ..... it would be worthwhile to observe that under the 1922 act, a deduction for bad and doubtful debts was available in the year when it was found to be irrecoverable.however, the income-tax act, 1961 has modified the language of this part of the provision which requires that the debt should have been taken into account in computing the income of the assessee .....