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TMI Blog1983 (11) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... controversy before us is regarding the bad debt of Rs. 10,759 claimed in respect of Roshan Lal & Sons, Jogiwan,Delhi. The ITO rejected the assessee's claim on the short ground that the matter regarding the said debtor was referred to arbitration and the arbitrator's award was dt.6th May 1978and, therefore, in the account year ending23rd June 1977, there were chances of recovery and therefore, allo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gave an ex parte decision on 6th May 1978 determining Rs. 14,193 as payable by the debtor to the assessee against principal and interest accruing till the date of the said decision, but the award could not be executed because the debtor could not be traced. The AAC observed that the assessee's writing off the debt on23rd June 1977was premature when the arbitration proceedings were going on before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... debt had become bad. Even if part of the debt is recovered from the said debtor in a subsequent year, the revenue can take action u/s 41(1) and assess the same in the year the money is received. Under these circumstances, we accept the assessee's contention and hold that the debt of Rs. 10,296 become bad in the year under consideration and should be allowed as such. We, accordingly, allow reducti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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