Bad debt recovery as business income is taxable on recovery, with limited loss set-off after discontinuance. Recovery of a bad debt previously allowed as a deduction is taxed as business income in the year of recovery to the extent the recovery exceeds the non-allowed portion. The newer provision applies even after business discontinuance, and unabsorbed loss after discontinuance may be set off only against income from such recovery, limited to the loss of the year business ceased and excluding speculation loss. Under the earlier provision, the business need not continue, but on specified successions the recovery is not taxable in the successor's hands.