established to have become a bad debt in that year; (iv) where any such debt or part of debt is written off as irrecoverable ... debited the amount of such debt or part of debt in that previous year to the provision for bad and doubtful debts account made under
deduction on account of bad debts
because the bad debts did not exceed the credit balance in the
provision for bad and doubtful debts account ... earlier Division Bench that if the bad
debt written off relate to debt other than for which the
provision is made under clause (viia), such
bad debts and the doubtful debts as bad debt denotes the debts which have been ascertained and are not recoverable at all, whereas doubtful debts ... liabilities and provisions along with the contingent liability has clearly been mentioned and nowhere provision for bad and doubtful debts appeared in such current liabilities
between
provision on bad assets and provision on standard assets. This
deduction exclusively allows deduction in respect of provision for
bad and doubtful debts ... viia) states that deduction for
provisions is allowable in respect of provision for bad and
doubtful debts, the computation of such deduction is made with
YEAR 2008-09
Provision for bad debts account (GL A/c No. 23,900)
Balance Sheet GL
To Bad debts written ... Loss Account, under the normal provisions, the assessee has not
claimed deduction of provision for bad debts but there was a claim of
deduction
amounts had become bad the same would have been written of as bad debts rather than the provisions being made for the same ... head "Provision no longer required written off". The assessee-company has thus made provision for bad and doubtful debts while computing the book
that the
provision should be for unascertained liability. The case
concerned the provision for bad and doubtful debt which is
made to cover ... provisions for the impugned bad debt. Therefore, in the
first place if the bad debt or doubtful debt is reduced from
the loans and advances
provision for bad and doubtful debts account under Clause (viia) is only the bad debt with reference to which the provision is made under Clause ... bad debts, the assessee is entitled to the deduction under Clause (vii) only the difference between the bad debt written off and the provision made
provision of bad debts of Rs.7.12 crores and accordingly allowed no bad debts.He held
that bad debts were allowable to the extent ... balance or provision for bad and doubtful debts, that the bad debts were to be reduced from
opening balance of provisions of bad and doubtful
bad and doubtful debts and disallowed Rs.114.51 cr. on the ground that
reserve for bad and doubtful debts cannot be considered as provision ... respect of bad debts of advance of non-rural branches of Rs.695.12
crore without setting of bad debts against provision for bad
