TaxTMI 
TaxTMI 
1990 (11) TMI 348
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....any, claimed the following bad debts: (i) Rs. 13,83,000 due by Ahmedabad Laxmi Cotton Mills Ltd. (ii) Rs. 8,14,547 due by India Paper Pulp Co. Ltd. 3. The IAC (Asst.) noticed that the assessee did not square up the accounts and debtors by crediting the said amounts to their accounts and instead the assessee credited the said amounts of debts to the "Bad Debts Suspense Account" and debited to the profit & loss account. This according to the IAC (Asst.) did not amount to writing off in the accounts of the assessee for the previous year within the meaning of s. 36(2)(i) of the Act. He also noticed that the approval of the board of directors for writing off these debts was given in March, 1979, when the previous year had already ended on Dec....
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.... of the clauses of the scheme of merger of the debtor-company with Arvind Mills Ltd. is that no interest would be payable to the assessee-bank for the period from the date of closure of the debtor company, i.e., from 12th August, 1977 to the date on which the scheme became finally operative. The scheme became operative from 18th January, 1978. 8. In these circumstances and with a view to reopening the closed mill and thereby securing the principal to the extent of rupees two and half crores, the bank had to agree to the proposal of the company and accordingly had to write off from the accounts of 1978 a sum of Rs. 13.83 lacs in respect of the unrealisable interest charged on the account of Ahmedabad Laxmi Cotton Mills Ltd. in terms of the ....
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....recommendation : "Recommendation; In view of the foregoing, we recommend that an amount of Rs. 8,14,547.51 be written off from our profit & loss a/c for the year 1978. If our recommendation is approved, the Board may kindly adopt the following resolution: Resolved that the recommendation of the Dy. Chief Officer (R&C) in his note dt. 15th March, 1979 for writing off an amount of Rs. 8,14,547.51 from 1978 account on account of write back of interest charged in the account of India Paper Pulp Co. Ltd. caused by restructuring of different accounts and charging of concessional rates of interest with retrospective effect from 1st April, 1977 be and is hereby approved." 11. It is stated that the approval of the board of directors was obtained....
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.... High Court in the case of CIT vs. Karamchand Premchand Ltd. (1985) 152 ITR 94 (Guj). In that case the assessee-company claimed deduction of an amount paid as remuneration to three of its directors. The directors had been rendering extra services for a long time but had not received any remuneration. At a general meeting held in September, 1967 the shareholders of the assessee-company passed a resolution authorising remuneration to the directors. Subsequently, the resolution was amended in January, 1968 and it was decided to pay an amount of Rs. 5,14,157 by way of remuneration to the aforesaid three directors for the year of account ended on 31st March, 1967. There the Gujarat High Court held that the remuneration accrued to the directors n....