1988 (12) TMI 5

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..... x Officer's finding was upheld in appeal. At this stage, the assessee requested the Appellate Assistant Commissioner to direct the Income-tax Officer to rectify the assessment for the assessment year 1963-64 under the provisions of section 155(6). The Appellate Assistant Commissioner declined to do so, but observed that the assessee was free to ask the Income-tax Officer to make such a rectification. The assessee so asked. The Income-tax Officer rejected the application. The assessee preferred an appeal to the Appellate Assistant Commissioner. The Appellate Assistant Commissioner analysed the provisions of section 155(6) and directed the Income-tax Officer to make the rectification. The Revenue preferred an appeal against the Appellate Ass .....

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..... , accordingly, upheld the Appellate Assistant Commissioner's order. From out of the Tribunal's judgment this question arises "Whether the provisions of section 155(6) have been correctly construed by the Tribunal ?" The relevant portion of section 155(6) of the Income-tax Act reads thus : "Where any such debt or part of debt as is referred to in clause (vii) of subsection (1) of section 36 is written off as irrecoverable in the accounts of the assessee for a previous year and the Income-tax Officer, is satisfied that such debt or part thereof became a bad debt in an earlier previous year not falling beyond a period of four previous years immediately preceding the previous year in which the debt or part is written off, the Income-tax Off .....

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..... to allow such debt or a part thereof as a deduction for the year in regard to which he is satisfied that the debt or part thereof became a bad debt remains. His finding has only been confirmed in appeal or in revision. There is no warrant for construing section 155(6) so as to hold that an assessee forfeits the right to have a bad debt written off in the year in which the. Income-tax Officer finds it to have become bad if he has filed an appeal or revision against the finding. We find that the Appellate Assistant Commissioner and the Tribunal were right in the construction they placed upon section 155(6) and answer the question in the affirmative and in favour of the assessee. No order as to costs.
Case laws, Decisions, Judgements, Or .....

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