47# l/ o/o O2.O5. 2 01 L Present: Ms. Prem Lata Bansal, Sr. Advocate with Mr' Deepak Anand, Advocate for the aPPellant' Mr. Digvijay Rai, Advocate for the respondent' Since no COD approval is required in view of recent judgment of the Supreme Court in the case of Etectronics Corporation of lndia Limited v, llnion of India and Others 332 ITR 58, the order dated 21'tJanuary,20Ll is recalled and the present appeal is restored at its original number. Accordingly, the application stands disposed of' ITA No. 83/20L1 The Airport Authority of lndia is the assessee in this case which has claimed a sum of Rs.76.10 lakhs as bad debts irrecoverable from the customs authority in the Income Tax Return filed by the assessee for the assessment year 2004-05. lt is not in dispute that the assessee had installed 34 X-Ray Baggage scanning Machines for the use of Customs Department. The said machines were purchased and installed on behalf of the Customs Department for a total sum of Rs.5.26 crores, which was to be paid by the Aviation Ministry. -l-he assessee WaS, however, released leSser amount tO the extent of Rs,76,10 lakhs which was treated as irrecoverable frcm debts and { I Digitally Signed By:AMULYA Certify that the digital file and physical file have been compared and the digital data is as per the physical file and no page is missing. Signature Not Verified F written off in the year in question and deduction thereof was claimed for this year. The Assessing Officer disallowed the claim on the ground that it was not business loss and was capital loss. The ITAT, however' allowed the claim observing that the assessee had suffered loss and therefore the claim of the assessee deserves to be accepted' Learned counsel for the revenue argues that the amount to be recovered from Aviation Ministry should be treated as loan and when it becomes irrecoverable, the same is neither available under section 36(1)(vii) read with Section 32 nor under Section 37(1) nor under Section 28 of the Income Tax Act. we do not agree with the aforesaid submission having regard to the facts of this case. lt cannot be disputed that in a matter like this the respondent was supposed to purchase and install those machines as a part of its business activity as it was at the instance of the Customs DePartment. The X-ray Baggage Machines were installed at sensitive airports and land boarders which are supervised by the custom Department. lt would therefore be a part of business activity of the assessee as the installments of the aforesaid assessee was imperative. No doubt, the Ministry of civil Aviation was supposed to reimburse the amount but it did not pay the amount to the extent of Rs.76.10 lakhs. Since the planning commission did not agree to reimburse the said amount. -{. ( p Under these circumstances, it would be treated as expenditure incurred by the assessee with the aforesaid parties. From whatever angle the matter is looked into, claim made by the assessee was allowable. No substantial question of law arises for consideration. The present appeal is accordingly dismissed. -?4'f-!,4 M.L. MEHTA, T. MAY 2,?OLL flK 1 ,t