Deduction u/s 36(1)(vii).

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.... such 'Sick' mills has been taken over by the State Textile Corporations set up in the various States. The Board had occasion to examine the question of allowance of bad debts in the hands of assessees who had sold stocks, raw materials, milling stores to such sick mills. Section 36(1)(vii) of the Income-tax Act; 1961 authorises deduction of any debt which is established to have become a bad debt ....

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....lity accrued or incurred before the undertaking was declared a relief undertaking and any remedy for the enforcement thereof shall be suspended and all proceedings relating thereto pending before any court or tribunal shall be stayed. 2. There are similar provisions relating to undertakings taken over by the State Textile Corporation. It cannot be stated that any debts owed by such sick mills b....