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2022 (7) TMI 171 - AT - Income TaxDisallowance on account of written off relating to embezzlement - amount embezzled from account by way of forged cheques by employee of the assessee company - HELD THAT:- As decided in Associated Banking Corporation of India [1964 (10) TMI 7 - SUPREME COURT] held that loss must be deemed to have arisen only when the employer comes to know about it and realized that the amount embezzled cannot be recovered, no doubt, it came to its knowledge prior. We noted that in the present case also, the assessee came to know of embezzlement in 2001-02 but he tried his level best for recovery of embezzled amount by filing police complaints and even the matter was referred to CBI by filing FIR against the accused persons as noted above. The assessee also pursued the matter with the Banking Ombudsman and the bank officials, when finally everybody refused and there was no chance of recovery, the assessee reversed this amount in the accounts of the assessee for assessment year 2008-09, when finally discovered that this amount is not recoverable. Hence, in such circumstances, we are of the view that the loss on account of embezzlement claimed by assessee is allowable in this year - Appeal of assessee allowed.
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