TMI Blog2018 (3) TMI 1351X X X X Extracts X X X X X X X X Extracts X X X X ..... ubtful debts have been duly adjusted against sundry debt and provisions for doubtful debt cannot be treated as uncertain liability - Decided in favour of assessee. - I.T.A No. 1486/Kol/2016 - - - Dated:- 23-3-2018 - Shri J. Sudhakar Reddy, Accountant Member And Shri S.S. Viswanethra Ravi, Judicial Member For the Appellant : Smt. S. Dasgupta,Addl.CIT, ld.DR) For the Respondent : Shri D.S. Damle, FCA, ld.AR ORDER Shri S.S.Viswanethra Ravi, JM: This appeal by the Revenue is directed against the order of the Commissioner of Income Tax (Appeals), 9, Kolkata dt. 22-03-2016 for the A.Y 2010-11. 2. At the time of hearing before us the ld. DR submits that the CIT-A was wrong in deleting the impugned addition as the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s relied on by the assessee before us. We find that the assessee made the provisions for doubtful debt under the head administrative and other expenses to its P L account. The assessee netted off the said provision for doubtful debt against sundry debtors and claimed deduction before the AO. In support of this, the assessee relied on the decision of the Hon ble Supreme Court in the case of Vijaya Bank reported in 323 ITR 166 (SC). But the AO denied to allow said deduction by stating that the principles laid down by the Supreme Court in the case of supra are applicable only to banks and not otherwise. We further find that the Co-ordinate Bench of this Tribunal vide its order found satisfied that the provisions of doubtful debts have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, the amount shown under the head provision for doubtful debt amounting to ₹29.71 lakh cannot be treated as unascertained liability. In holding so, we find support and guidance from the judgment of Hon'ble Supreme Court in the case of Vijaya Bank vs. CIT 323 ITR 166 (SC) wherein the relevant question raised by Hon'ble Apex Court and the finding Their Lordship stand as under:- After insertion of Explanation to s. 36(1)(vii), assessee is required not only to debit the P L a/c but simultaneously also reduce loans and advances or the debtors from the assets side of the balance sheet to the extent of the corresponding amount so that at the end of the year the amount of loans and advances/debtors is shown as net of prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,24,55,468/- Less: provision 1,76,63,989/- 1,24,55,468/- Outstanding for a period Of less than six months 19,09,51,709/- 13,84,56,260/- 16,16,01,230/- 20,98,48,239/- Thus, to the extent, the debts were considered doubtful, the same were written off by actually writing off in profit and loss account and also in the books of account by crediting the sundry debtors on the asset side of balance sheet. This methodology was in conformity with the decision of Hon'ble Supreme Court in the case of Vijaya Bank's case (supra) and, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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