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| The Tax Publishers2020 TaxPub(DT) 1381 (Bang-Trib) INCOME TAX ACT, 1961
Section 36(1)(viia)
Deduction on account of Provision for bad and doubtful debts under section 36(1)(viia) could be allowed only to the extent such provision is actually debited in profit and loss account by assessee for the relevant previous year. Since, in the instant case assessee had not debited any sum towards provision for bad and doubtful debts any sum towards profit and loss account, AO was justified in denying deduction.
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Business deduction unders ection 36(1)(viia) - Provision for bad and doubtful debts - Assessee had not debited any sum towards provision for bad and doubtful debts -
Assessee-bank claimed deduction on account of provision for bad and doubtful debts. AO denied deduction.Held: Deduction on account of Provision for bad and doubtful debts under section 36(1)(viia) has to be allowed only to the extent such provision is actually debited in profit and loss acount by assessee for the relevant previous year. Since, in the instant case assessee had not debited any sum towards provision for bad and doubtful debts any sum towards profit and loss account, AO was justified in denying deduction.
REFERRED :
FAVOUR : Against the assessee.
A.Y. : 2011-12
INCOME TAX ACT, 1961
Section 37(1)
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