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TMI Blog2016 (11) TMI 1238X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961. 2. The assessee has raised several grounds in its appeals, however, the cruxes of the issues are as follows : "(i) The learned Commissioner of Income-tax (Appeals) has erred in sustaining the disallowance amounting to Rs. 31,15,08,410 made by the learned Assessing Officer being provision created towards non-performing asset under section 36(1)(vii) of the Act. (ii) The learned Commissioner of Income-tax (Appeals) has erred in confirming the quantum of aggregate average advances adopted by the Assessing Officer for the purpose of giving relief under section36(1)(viia) of the Act. 3. The assessee has also raised additional ground which is as follows : "The assessee being a co-operative society carrying on the business of b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 36(1)(viia). There was no omission/error in calculating the income. The assessee has written off in the profit and loss account as per the working given below : Bad debts as at 31-3-2010 Rs. 120,32,58,741 Bad debts as at 31-3-2009 Rs. 89,17,50,325 Bad debts debited to the profit and loss account Rs. 31,15,08,416 Thereafter, on examining the books of account of the assessee, the learned Assessing Officer arrived at a conclusion that the assessee had only created a provision for bad and doubtful debts and had not written off any bad debts during the financial year 2009-10 and, therefore, made addition of Rs. 31,15,08,410 by disallowing the bad debt not written off in the books of account. 6. On appeal, the learned Commissioner o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Further, as per the decision of the hon'ble apex court in the case of Vijaya Bank v. CIT reported in [2010] 323 ITR 166 (SC) ; [2010] 231 CTR 209 it has been held that if an assessee debits an amount of doubtful debt to "profit and loss account" and credits "sundry debtors account" the same should be allowed as a deduction. This decision being the law of land has to be meticulously followed by all the relevant authorities. However, at the same time, an effective control has to be exercised and established before the Revenue so that the same debtors are not claimed as bad debts again and again because the debtors towards which such bad debts are claimed are not written off in the books of account. Since these aspects have not been consi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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