Bad debt deductions for banks are not automatic; tax officers must determine irrecoverability before allowing relief.

Banks' bad-debt deductions are not automatically allowed; the Income-tax Officer must decide if a debt is irrecoverable by considering relevant facts. While banks write off or provide for doubtful debts under company and banking law, tax relief is permitted only to the extent debts are shown irrecoverable. Audit or directors' certificates are not universally conclusive; officers may accept such certificates in appropriate cases but retain discretion to call for further evidence and to select significant items for enquiry rather than examine every entry.

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