https://www.taxtmi.com/caselaws?id=277240 A bad debt deduction was denied because the amount written off was not a trading debt arising in the assessee's own business. The court held that, under the mercantile system, a debt is deductible only if it would have entered the computation of business profits if recovered and is referable to the business carried on by the assessee. Here, the liability arose from a joint borrowing and an accommodation transaction connected with another person's obligation, not from the timber business. As the loss was unconnected with business profits, it could not be treated as a revenue loss or allowable bad debt. The question was answered in the negative, against the assessee. en-us Fri, 08 Jun 1951 00:00:00 +0530 Thu, 29 Nov 2018 16:29:20 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=277240 A bad debt deduction was denied because the amount written off was not a trading debt arising in the assessee's own business. The court held that, under the mercantile system, a debt is deductible only if it would have entered the computation of business profits if recovered and is referable to the business carried on by the assessee. Here, the liability arose from a joint borrowing and an accommodation transaction connected with another person's obligation, not from the timber business. As the loss was unconnected with business profits, it could not be treated as a revenue loss or allowable bad debt. The question was answered in the negative, against the assessee. Case-Laws Income Tax Fri, 08 Jun 1951 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=277240