https://www.taxtmi.com/caselaws?id=459133 ITAT Mumbai allowed assessee's claim for bad debts deduction under Section 36(1)(vii) read with Section 36(2). Lower authorities had denied the claim arguing it was merely a provision and individual debtor accounts weren't closed. Following Tainwala Chemicals and Vijaya Bank precedents, ITAT held that debiting provision to profit and loss account while correspondingly reducing assets constituted writing off debt. Since assessee had offered interest income to tax as business income, lending activity qualified as business. Tribunal concluded assessee entitled to bad debts deduction despite not closing individual accounts, deciding against revenue. en-us Wed, 25 Jul 2018 00:00:00 +0530 Thu, 05 Dec 2024 14:49:56 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=459133 ITAT Mumbai allowed assessee's claim for bad debts deduction under Section 36(1)(vii) read with Section 36(2). Lower authorities had denied the claim arguing it was merely a provision and individual debtor accounts weren't closed. Following Tainwala Chemicals and Vijaya Bank precedents, ITAT held that debiting provision to profit and loss account while correspondingly reducing assets constituted writing off debt. Since assessee had offered interest income to tax as business income, lending activity qualified as business. Tribunal concluded assessee entitled to bad debts deduction despite not closing individual accounts, deciding against revenue. Case-Laws Income Tax Wed, 25 Jul 2018 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=459133