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2005 (7) TMI 70 - HC - Income TaxBad debt - provision/writting off - "1. Whether Tribunal was right in allowing the assessee's claim for a bad debt, when the bad debt had not actually been written off in the books of account? 2. Whether, Tribunal was right in allowing the claim for bad debt on the ground that the provision had been shown under the head 'Expenditure' in the annual report of the assessee-company? 3. Whether an assessee other than a banking company can be allowed a claim for a bad debt on the basis of a mere provision?" - In the present case, it can be seen that the assessee did not write off the debt in question as irrecoverable in his accounts for the previous year. Hence on the plain language of section 36(1)(vii) the debt cannot be allowed as a "bad debt" -Making a provision is not the same thing as writing off a debt as irrecoverable. – Thus, impugned judgment of Tribunal, and of the CIT (Appeals) with respect to the claim of the assessee regarding bad debts are set aside, and the order of AO is restored
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