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2014 (11) TMI 506 - HC - Income TaxClaim of bad debts disallowed – Evidences produced by assessee or not – Whether the claim of the assessee seeking allowance for debts written off as irrecoverable, irrespective of whether they are written off after 180 days or after 120 days as per the changed management policy in respect of each assessment year - Held that:- In TRF. LTD. Versus COMMISSIONER OF INCOME-TAX [2010 (2) TMI 211 - SUPREME COURT] the issue related to claim of bad debts written off discussed and it was held that when bad debt occurs, the bad debt account is debited and the customer's account is credited, thus, closing the account of the customer - In the case of companies, the provision is deducted from sundry debtors - The judgment was delivered on 9.2.2010 – it has been clearly held that after 1st April 1989, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable - It is enough if the bad debt is written off as irrecoverable in the accounts of the assessee - "bad debts" if written off, on the accounts of the assessee and appropriately claimed before the competent authority, the authorities are bound to consider the same as decided by the Hon'ble Supreme Court – the matter is remitted back to the limited purpose - Decided partly in favour of assessee.
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