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TMI Blog2013 (7) TMI 449X X X X Extracts X X X X X X X X Extracts X X X X ..... losing the account of the customer – relying upon the decision of CIT Vs. Punjab Agro Industries Corporation (2001 (9) TMI 87 - PUNJAB AND HARYANA High Court) and T.R.F. Ltd. vs. CIT [323 ITR 397], decided against the revenue. - Tax Appeal No. 200 of 2013 - - - Dated:- 16-4-2013 - Akil Kureshi And Sonia Gokani,JJ. For the Petitioner : Mr. Sudhir M. Mehta For the Respondent : Mr. B. S. Soparkar ORDER (Per : Honourable Ms. Justice Sonia Gokani) 1. Brief facts necessary for adjudging the issue are as follow. 1.1 The assessee-respondent is a State Government owned Company and is acting as development financial institution for assisting medium and large scale industries in the State of Gujarat. 1.2 The case of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A] Whether on the facts and circumstances of the case, the Hon'ble Tribunal was justified to reverse the order of CIT(A) in deleting the disallowance made in respect of write off of the interest amounting to Rs.2,98,49,969/- claim for even though loss of interest was not crystallized during the year ? 2. We have heard learned counsel Mr. Sudhir Mehta for the revenue and learned senior counsel Mr. Saurabh Soparkar for and on behalf of the caveator. 3. It is argued by the learned counsel Mr. Sudhir Mehta relying on the decision rendered in case of Madras Fertilizers Ltd. Vs. Commissioner of Income tax reported in 209 ITR 174 that such deletion was not justifiable. The Madras High Court has held that Deduction can be permitted in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent Year 1994-1995 and held on the same line that the claim of the assessee was either to make it allowable as revenue expenses under section 37(1) or as a bad debt and as both were considered similar and the part of the same claim, it was of the opinion that controversy no longer continues. 6. The Tribunal also noted that the assessee had reduced a sum of Rs.3,15,20,598/- under the heading of interest account as an adjustment in respect of earlier years . A legal action under section 29 of SFC Act was initiated and Board reversed such entry. As the decision of the Board was received in the year under question, the expenses of the previous year had been charged to the P L Account in the current year. The Tribunal, therefore, conclude ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner of Income-tax(Supra) that After the amendment of section 36(1)(vii) of the Income-tax Act, 1961, with effect from April 1, 1989, in order to obtain a deduction in relation to bad debts, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable : it is enough if the bad debt is written off as irrecoverable in the accounts of the assessee. In the words of the Supreme Court: 4. This position in law is well-settled. After 1 April 1, 1989, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable. It is enough if the bad debt is written of as irrecoverable in the accounts of the assessee. However, in the present case, the Assessing Officer has not ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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