When assessee writes back certain provisions & considers it as income, he cannot deduct the same from computation of income, on the ground that in the earlier year these provisions were disallowed.

Last updated: 22 January 2021

Court :
ITAT Mumbai

Brief :
This appeal by the Revenue is directed against the order of the learned Commissioner of Income Tax (Appeals)-3, Mumbai (‘ld.CIT(A) for short) dated26.03.2018 and pertains to the assessment year (A.Y.) 2012-13.

Citation :
ITA No. 4458/Mum/2018

IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI

BEFORE SHRI SHAMIM YAHYA, AM AND SHRI RAM LAL NEGI, JM

ITA No. 4458/Mum/2018
(Assessment Year: 2012-13)

Dy. CIT(LTU)-1, World Trade Centre,
Centre No. 1, 29th Floor, Cuffe Parade,
Mumbai-400 005
PAN/GIR No. AAACF 0252 G
Appellant

Vs.

M/s. CMI FPE Ltd.
Plot No. 64, Mehta House,
Road No.13, MIDC, Andheri (E),
Mumbai-400 093
Respondent

Appellant by : Shri Uodal Raj Singh
Respondent by : Shri Niraj Sheth

Date of Hearing : 20.10.2020
Date of Pronouncement : 01.01.2021

O R D E R

Per Shamim Yahya, A. M.:

This appeal by the Revenue is directed against the order of the learned Commissioner of Income Tax (Appeals)-3, Mumbai (‘ld.CIT(A) for short) dated26.03.2018 and pertains to the assessment year (A.Y.) 2012-13.

2. The grounds of appeal read as under:

1. On the facts and in the circumstances of the case and in law, the ld.Commissioner of Income Tax (Appeals) erred in directing the Assessing Officer toexamine the records of assessee, whether whole or part of the provision of Rs.423.59lakhs written back was disallowed in any of the A.Y. 2010-11 and 2011-12 and if so, to allow the provision to the extent it was disallowed in the assessment order for the relevant previous year?

3. Brief facts of the case are that the Assessing Officer observed that on perusal of the profit and loss account, and audit report of the assessee it is noticed that the assessee has credited an amount of Rs.423.59 lacs under the head provision for estimated loss on contracts. The assessee vide letter dated 23rd February 2015 has submitted as under:-

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