Obsolescence allowance turns on write-off in maintained books, not on keeping a prescribed set of accounts.

Obsolescence allowance under section 10(2)(vii) was considered to depend on whether the relevant amount had actually been written off in the assessee's books, not on maintenance of any prescribed set of accounts. The absence of a complete day-book and ledger did not defeat the claim where the assessee maintained subsidiary books and a buses valuation book containing the write-off entry. Section 13, which permits estimated computation where the accounting method is defective, was held irrelevant to compliance with the proviso to section 10(2)(vii). On that basis, the disallowance was not justified and the allowance was allowable.

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Issues: Whether the disallowance of obsolescence allowance was justified where the assessee maintained only subsidiary books and a buses valuation book, and not a complete day-book and ledger, but had written off the amount in the books maintained by him.

Analysis: The allowance under section 10(2)(vii) required that the relevant amount be actually written off in the assessee's books, but the provision did not prescribe any particular set of books as a condition precedent. The absence of a day-book or ledger did not mean that the assessee kept no books of account at all, especially when the record showed maintenance of subsidiary books and a buses valuation book containing the relevant entry. Section 13 permitted computation on an estimated basis where the method of accounting was defective, but that circumstance had no bearing on whether the allowance claim complied with the proviso to section 10(2)(vii).

Conclusion: The disallowance was not justified, and the assessee was entitled to the obsolescence allowance.

Ratio Decidendi: Compliance with the requirement of writing off the amount in the assessee's books is satisfied if the entry is made in the books actually maintained by the assessee; the proviso does not require maintenance of any prescribed or complete set of accounts.

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