Can bad debt be claimed after 3 yr.s?
This query is : Resolved
24 August 2011
income was recognized 3 years before. and till now there is case going on for the recovery of income.. and it is almost irrecoverable as per our judgement.. so how to recognize it as bad debts? can it be deducted in deferred manner as the amount is big of Rs 20 lacs, so it will lead to loss for the current year? give me reply as fast as possible.. it's very urgent for me
24 August 2011
Bad debts is allowed only when you write it off in your books. Only provisions shall not be allowed
24 August 2011
As far as Accounts is concerned:
When you are certain that amount is no more recoverable, you have to account for as bad-debt in current year irrespective of amount involved and it's impact on current year bottom line. In case of otherwise you are deviating from accounting standards and auditor may qualify his audit report.
As far as Income Tax concerned:
3 Year is not an issue for claiming it as bad-debt. When ever you are writing off an account which has already routed through P & L account in any previous year or current year ,there will be no objection of tax authorities. You can absolutely claim it as expense.
When you are certain that amount is no more recoverable, you have to account for as bad-debt in current year irrespective of amount involved and it's impact on current year bottom line. In case of otherwise you are deviating from accounting standards and auditor may qualify his audit report.
As far as Income Tax concerned:
3 Year is not an issue for claiming it as bad-debt. When ever you are writing off an account which has already routed through P & L account in any previous year or current year ,there will be no objection of tax authorities. You can absolutely claim it as expense.
24 August 2011
after legal judgement you can claim bed debt in the year in which judgement received and you can also claim exp. on the case.
24 August 2011
Bad debts can be only claimed only when it is written off.
Also in a recent case law of Vijaya Bank Ltd. given by Honourable supereme court, even provision will be allowed as bad debt if you deduct the same from the debtors balance in the balance sheet side.
Also in a recent case law of Vijaya Bank Ltd. given by Honourable supereme court, even provision will be allowed as bad debt if you deduct the same from the debtors balance in the balance sheet side.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- TDS U/S. 194NF
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- ITC temporary reversal and reclaim
- Inventory of finished goods
- Applicable TDS rate for sale of property in Nov 2024
- Tds on building rent monthly
- Confusion around Form 26QB fields
- Adjustment entry in the case of Individual and HUF on 31st March
- Stock difference tax applicable on composite rate or normal rate
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
Trending Online Classes
CAclubindia
