2017 (4) TMI 956

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....as erred in fact and law in allowing the bad debts claimed by the assessee in the computation of income. 2. The Ld.CIT(A) has erred in fact and law in not considering that the assessee had not routed the claim of bad debts through P&L account. 3. The Ld. CIT(A) has erred in not considering the decision of the Hon'ble Kerala High Court in the case of CIT vs Hotel Ambassador in 121 Taxman 437 (Ker.), wherein it was held that the writing off the bad debts without charging the same in P&L account is not a "write off". 4. The Ld. CIT(A) has erred in not considering that though the assessee had claimed to have routed the bad debts through P&L account and taxes had been paid in the earlier years, the assessee failed to furnish any evidenc....

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.... forming the part of Rs. 1,21,22,601/-, the same was written off in computation of income forming the part of return of income for assessment year 2009-10(Year ended on 31.03.2009), so there was no double deduction. The AO was of the opinion that since bad debts is not routed through P & L A/c and also assessee has not furnished the details in support of the fact that the bad debts written off in the earlier years were offered to taxation in the computation of income of those years. Hence, the ld. Assessing Officer passed the assessment order dated 24.11.2014 consequent to the direction of Ld. CIT u/s.263 of the Act dated 18.03.2014, wherein Ld. CIT observed that "....in the present case, bad debts have not been routed through P&L a/c. The ....

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....ken the support of order of Mumbai Tribunal in the case of Arrow Coated Products Ltd., Vs. ACIT in [2012] 22 taxmann.com 31(Mum) wherein held that:- In the light of the observations of the Supreme Court, it is reasonable to hold that there is no prohibition to claim deduction on account of bad debts in the year in which the debtors account is squared off by crediting bad debts. The only condition when a claim for deduction is made in the year in which the debtors account is squared off would be to see that the deduction should not have been claimed in the year in which the provision for bad debts was written off in the profit and loss account and corresponding reduction of the debtors is shown in the balance sheet So long as there is no ....