2011 (1) TMI 408

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....60 as bad debts written off consisting of twenty items. In so far as bad debts are concerned, the Assessing Officer called for details and explanations. After conducting enquiry, the Assessing Officer came to the conclusion that eleven items of bad debts, in a sum of Rs. 11,85,086 could not be written off as bad debts and that the explanation of the assessee that it had issued computer generated reminders to the customers (sundry debtors) in a standard proforma was not convincing. The Assessing Officer, however, allowed the claim of the assessee for bad debts in a sum of Rs. 2,41,174. The Assessing Officer did not also allow certain amount of depreciation and loss for the assessment year 1995-96. With these, we are not concerned in this cas....

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....ad "Profits" and "Gains" of business, section 36 enumerates "Other deductions". One of them is bad debts, which reads as under.   "36. Other deductions.-(1) The deductions provided for in the following clauses shall be allowed in respect of the matters dealt with therein, in computing the income referred to in section 28- . . .   (vii) subject to the provisions of sub-section (2), the amount of any bad debt or part thereof which is written off as irrecoverable in the accounts of the assessee for the previous year :   Provided that in the case of an assessee to which clause (viia) applies, the amount of the deduction relating to any such debt or part thereof shall be limited to the amount by which such debt or part th....