We are in to seed and fertilizers trading business we are also doing money lending in same Proprietary firm, one loan of rs 2000000 become bad debt now ,as per provision sec 36 we have not billed or sale any goods and services to that firm.we are paying tax on interest on loan . so is it logical to claim bad debt of loan which is default.
Request you to guide us can I show Bad Debt in my P&L .
Anand
Business Seeks Advice on Claiming $2M Loan Default as Bad Debt in Financial Statements; Expert Input Needed A business involved in seed and fertilizer trading, which also engages in money lending, is seeking advice on whether a 2,000,000 loan given to a non-related party that has defaulted can be claimed as a bad debt in their profit and loss account. The business operates both activities under a single proprietary firm and prepares one set of financial statements for both. The discussion includes a suggestion that the bad debt might be deductible, but further expert opinions are encouraged. (AI Summary)
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