Jurisprudentiol– Tomorrow's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Income Tax

Disallowance of provision for bad debt u/s 36(1)(viia) - Borrowing of various concepts from Banking Regulation Act for purposes of allowing exemption, deduction or computation of income under Income-tax Act cannot be extended endlessly - Assessee's appeal for relief set aside: ITAT

THE assessee is a registered co-operative Society with Registrar of Co-operative Societies and carrying on banking business by obtaining license from RBI in terms of s.22 of the Banking Regulation Act, 1949. The assessee had claimed a sum of Rs.95 ,46,813.59 as bad and doubtful debts which was debited in the reserve account. Total receipts as per profit & loss account was shown at Rs.40,38,588.41. The AO observed that as per provisions of section 36(1 )(viia) only 5% is allowable under this head which comes to Rs.2,01,929.42. Hence, the excess over 5% which was worked out at Rs.93,44,884.17 was disallowed and added into the total income of the assessee.

Customs

Recalcitrant Revenue finds its appeal dismissed by Tribunal as being defective

THIS is one order served by “ dasti ” that Revenue ought not to take lightly.

Filing an appeal for the sake of filing one has become the order of the day. It was only a small “authorization” that was required to be filed along with the appeal and that should have ended the matter, presuming there is one on record! Fortunately, the Tribunal did not vent its ire against the helpless DR, but we are certain this is not the end of the story.

ServiceTax

Applicant primarily providing Security Agency services coupled with other services such as management advice, group auditing and financial planning - Adjudicating authority treating it as single service of Security Agency - Tribunal orders pre-deposit of Rs.15 lakhs considering service tax liability only on security agency services

See our columns Tomorrow for the judgements