deductions under section 41(1)

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kanwal (Querist)
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07 December 2009 The Assessee not claimed deductions under section 41(1) of Income Tax Act, 1961 on account of bank interest waived by the bank during the relevant years which was treated as business income and the company has not claimed amount of interest as expence in the respective years. Now the Company wants to claim the benefits, please clarify whether the claim is justified or not?

Manikanta Raju CA,CWA,(CS)

Manikanta Raju CA,CWA,(CS) (Expert)
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08 December 2009 Hi,

You can file revised return or else file rectification u/s 154

kanwal

kanwal (Querist)
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08 December 2009 Thanks for the reply. Pl also clarify on my earlier query that since the appeal is pending before the CIT can additional gournds be filed u/s 41 (!) of the Income Tax Act.

CA Balram Sharma

CA Balram Sharma (Expert)
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10 December 2009 Hello as you mention that NO allowance and expenditure have been claim by you u/s 41(1).
hence there is question on income .

further accourding to section 43B dedution will be allowed only when the actual payment is made by assessee.

CA Balram Sharma

CA Balram Sharma (Expert)
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10 December 2009 Explaination of section 43B also provide that waiver of interest or reformation of interest in to loan not amout of payment of interest income,

CA Balram Sharma

CA Balram Sharma (Expert)
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10 December 2009 so he treatment of company is not correct to treat the waiver of interest as income,

there is option to company that already mention by the my other expert friend,

1. revised the return,
2. made rectification application.

CA Balram Sharma

CA Balram Sharma (Expert)
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10 December 2009 in last i would like to conclude the claim is not justifed by company ,

According my all reasoning give my me ,

kanwal

kanwal (Querist)
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10 December 2009 I really thanks the experts for giving me valuable advice. Once again heartiest thanks

kanwal

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