9911796707
TMI Blog2001 (8) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... ding of the Tribunal that the debt of Rs.2,42,006 relating to Shalimar Works Ltd. had become bad and irrecoverable during the previous year is based on any wrong principle of law or ignoring the relevant materials?" In compliance with the direction the aforesaid questions are referred for our opinion with the statement of the case. The relevant assessment year is 1981-82. During the course of assessment, the Assessing Officer noticed that a sum of Rs.2,42,006 was due from Shalimar Works Ltd. and the assessee had written off that amount and claimed it as bad debt in this year. The Assessing Officer has rejected the claim of the assessee. According to him though the assessee is an unsecured creditor the assessee has not produced any evide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve that the assessee has not brought any material to show that the debt has become bad. It is not clear whether the assessee has filed the claim before the official liquidator at all and if at all filed, the results thereof. The amount paid by the Government on taking over Shalimar Works Ltd. is also not made available to us. Similarly, the quantum of secured creditors and unsecured creditors is also not available. Therefore, in view of these facts, we hold that debt has been written off prematurely and without taking any steps for its recovery. Hence, we hold that the Commissioner of Income-tax (Appeals) is not justified in deleting the same and we reverse his order on this point." Dr. Pal, learned counsel for the assessee, submits that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... When this court while considering the possibility for recovery of loan in case of unsecured creditors found that the entire amount went to the secured creditors and nothing remains to be paid for unsecured creditors, there is no justification to deny the claim of the assessee. Therefore, following the afore said finding of this court regarding possibility of the recovery of loan of unsecured creditors when there is no chance the assessee has rightly written off that debt treating it as a bad debt. In view of the aforesaid finding, the Tribunal has committed an error. In the result, we answer question No. 1 in the negative, i.e., in favour of the assessee and against the Revenue. As there was no finding of the Tribunal that the debt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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