TaxTMI 
TaxTMI 
2014 (4) TMI 782
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....2,152/- relying on the decision of Hon'ble Supreme Court in the case of TRF Limited without appreciating the fact that in one of the cases, the Assessee had written off current year's debit balance as bad debt as can be seen from the annexure enclosed herewith." 2. During the course of assessment proceedings AO noted that the Assessee had written off a sum of Rs.6,27,84,689/- towards bad debts and irrecoverable advances out of which advances written off of Rs.93,52,537/- were deducted from total income and balance amount of Rs.5,34,32,152/- was claimed as bad debts and irrecoverable advances to P/L Account. The AO asked the assessee to furnish the party-wise details of bad debts and irrecoverable advances. The assessee furnished deta....
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....the assessee has submitted that during the year the assessee has closed various branches and therefore, it was not possible for the assessee to recover the outstanding receivables from the parties. The assessee took a bonafide decision to write off the amount instead of wasting good money for bad money. The ld. AR has relied upon the decision of Hon'ble Supreme Court in the case of TRF Ltd. and submitted that the assessee has written off bad debts as irrecoverable, then the claim of the assessee cannot be denied. The advances given to the parties are in connection with the assessee's business. He has referred the impugned order of CIT(A) and submitted that CIT(A) has considered the fact that the advances were given in the course of busi....
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.... Further, the assessee has not furnished the details by segregating the bad debts and advances treated as irrecoverable and written off during the course of assessment proceedings. If such details were furnished before CIT(A) then the AO should have been given opportunity to consider the same and rebut the same if so desired. Therefore, as far as the claim of bad debts regarding treating the same as irrecoverable we do not find any error in the order of CIT(A) while allowing the claim by following the decision of Hon'ble Supreme Court in the case of TRF (supra). However, it is not clear from the record that how much amount out of the total claim of the assessee is regarding the advances given to the various parties and whether the advan....