Bad debts
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
15 June 2012
A company has bad debts in the 1st year of operation on account of export of services (IT Technologies). The service reciepant has become insolvent and recovery of amount is impossible. Can the company write off the amount in 1st year itself. Is there any need to inform RBI.
15 June 2012
The bad debts can be written off in the 1st year also & can be claimed u/s 36. The case law by sc in TRF LTD supports the claim.
15 June 2012
Agreed with the expert. Also note that it is a requirement of Accounting Standard also to book the anticipated losses.
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