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2014 (1) TMI 898 - AT - Income TaxDisallowance in respect of bad debts written off u/s 36 of the Act - Held that:- The decision in TRF. LTD. Versus COMMISSIONER OF INCOME-TAX [2010 (2) TMI 211 - SUPREME COURT ] followed - This is the case, where CIT (A) is completely not judicious on the issue raised before him and has not regarded the established binding judicial pronouncements - 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. Thus, the assessee is entitled to relief on account of bad debts – Decided in favour of Assessee. Disallowance as bad debts twice while computing disallowance u/s 14A of the Act – Held that:- It amounts to making addition twice, which is not sustainable in law - assessee mentioned that there cannot be disallowance u/s 14A of the Act in respect of the claim of bad debts – relying upon Star Television Entertainment Ltd [2010 (1) TMI 46 - AUTHORITY FOR ADVANCE RULINGS] - The claim of the bad debts is allowable in favour of the assessee – the issue remitted back to the AO for fresh adjudication after considering on bad debts - the expenditure of bad debt is outside the scope of the provisions of section 14A r w r 8D – Decided partly in favour of Assessee.
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