TMI Blog2005 (2) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... stablished or found by any of the authorities. Therefore, the irrecoverability cannot be questioned and as such the irrecoverable part excluded in the award, having regard to the facts and circumstances of the case, satisfies the ingredients of section 36(2) and is a bad debt allowable for deduction under section 36(1)(vii). - We answer the question in the affirmative, in favour of the assessee an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the ground that the assessee had agreed to accept the award of the arbitrator and which ultimately it had accepted. Therefore, according to him, the assessee had waived or forgone its claim by its conduct without attempting to recover the said amount of difference between the claim and the award. Therefore, once the claim is waived or forgone, there cannot be any question of there being any du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the analogy on which the learned Tribunal had proceeded is preposterous and cannot be accepted. The dues always were there but it could not be realised despite the attempt to recover the same, through statutorily recognised and established legal method and manner of recovering a disputed claim. Section 36(2): Failure to recover through arbitration: Whether bad debt: We have heard learned cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... binding on them. It appears that an attempt was made in the company petition where the award was questioned. But ultimately when the assessee had accepted the amount awarded by the arbitrator, neither the authorities under the 1961 Act nor the court is supposed to question the wisdom of the assessee as to the business expedience under which it had accepted the amount, unless it is established to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thorities. Therefore, the irrecoverability cannot be questioned and as such the irrecoverable part excluded in the award, having regard to the facts and circumstances of the case, satisfies the ingredients of section 36(2) and is a bad debt allowable for deduction under section 36(1)(vii). Order: In the circumstances, the appeal succeeds and is allowed. The order of the learned Tribunal is set ..... X X X X Extracts X X X X X X X X Extracts X X X X
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