2021 (12) TMI 643

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....written off. 3. Briefly the facts are, the assessee is a resident company providing offshore and onshore survey and navigation services. For the assessment year under dispute, assessee filed its return of income on 29.11.2011 declaring total income of Rs. 2,86,25,034/-. In course of assessment proceedings, the assessing officer (AO) noticed that assessee has claimed deduction of an amount of Rs. 2,55,97,771/- towards bad debt written off. Noticing this, the AO called upon the assessee to furnish the details and justify the claim. In response to the query raised, assessee furnished its reply with supporting evidence and justified its claim of deduction. The Assessing Officer, however, was not convinced with the submissions of the assessee....

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....ter, it also issued a legal notice to M/s.Naftogaz India Pvt. Ltd., a copy of which has also been placed in the paper book. It is seen that this letter is an ultimatum to the creditor to pay the sum along with interest within a period of 21 days failing which the appellant would have to file a winding-up petition against the creditor and seek the appointment of an official liquidator for liquidating the company. However, the appellant did not follow up on this and has explained this inactivity on account of the fact that it realised that the liabilities of M/s.Naftogaz India Pvt. Ltd. were far in excess of its assets and there were a number of secured creditors who had already filed cases against M/s.Naftogaz India Pvt. Ltd. Therefore, sinc....

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....as been written off in the accounts of the appellant. The appellant has also cited the judgment of Jurisdictional High Court in the case of CIT Vs Star Chemicals Bombay Pvt. Ltd. 313 (ITR 126 (Bom) which basically reiterates the position taken by the Hon'ble Supreme Court in the case of CIT v. TRF Ltd. (supra)." 4. We have considered rival submissions and perused the materials on record. A reading of the assessment order would revealed that the AO has not disputed the fact that the amount of Rs. 2,55,97,771/- towards bad debts written off. The reasons shown by the assessee for writing off the amount has not been disputed by the AO. The AO has also recorded that the assessee had issued legal notice to the person concerned for recovery of ....