|
III. Useful Case Laws:
1. Khanna and Annadhanam Vs. CIT, ITA No. 1286/2008, Judgment delivered on: 29.01.2013, High Court of Delhi
“Whether
the amount received by the appellant from DTTI in terms of release
agreement with DTTI is capital receipt or revenue receipt?"
Facts of the case:
The
understanding between the assessee-firm and the chartered accountants
firm in Calcutta was limited to the work in Delhi and surrounding areas
only. In 1996, it transpired that DHS wanted another firm of chartered
accountants by name C.C. Chokshi & Co., of Bombay to represent its
work in India. Accordingly an agreement was entered into on 14.11.1996
which was called a release agreement, under which the assessee firm was
to no longer represent DHS in India; thereafter DHS would not refer any
work to the assessee-firm. In consideration of the termination of the
services of the assessee-firm, a compensation of US$ 325000 amounting to
Indian `1,15,70,000/- was paid by DHS to the assessee-firm.
Held:
In view of
decision of Hon’ble Supreme Court in the case of Kettlewell Bullen &
Co. Ltd. Vs. CIT: (1964) 53 ITR 261, It was held that the compensation
received for loss of an asset of enduring value would be regarded as
capital receipt.
(Please click here for judgment)
2. Natco Pharma Ltd. Vs. Dy. CIT, IT Appeal No. 377 (HYD.) of
2009 and 487 & 686 (HYD.) of 2010, Date of Order: 31.10.2012, ITAT-
Hyderabad
Bad debt written off not allowable if weren’t considered while computing income of earlier years
As submitted
by the DR if it is an expenditure incurred in respect of its business,
it should have been claimed during the relevant assessment year and if
it is a debt it should have been advanced in respect of trade or
business of the assessee and it should have gone to computation of
income of the assessee in the previous year in which the amount of such
debt or part thereof is written off or of an earlier previous year or
represents money lent in ordinary course of business. In the present
case the assessee is not able to lead any evidence how it has gone into
computation of income of the assessee in the assessment year under
consideration or in any other assessment year. Being so, we are of the
opinion that findings of the lower authorities in disallowing the claim
of the assessee are justified. We confirm the order of the CIT (A).
(Please click here for judgment)
|
New User? 
Subscribe Now