write off of bad debt

This query is : Open

Sanjay Agarwal (Querist)
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29 July 2009 One of my client is having unrealised debtors for past 5 / 6 years. He wants to write off the same as bad debt in the current year resulting in adjusting of profits. Pl advice in accordance with the provisions of IT Act whether the same will be allowed as deduction and expense or not.

Shyam Lal Naik

Shyam Lal Naik (Expert)
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30 July 2009 Only two condition need to be satisfied.

1. The amount form part of turnover in earlier year and
2. The anount was actually written off in the books of accounts.

Since both the conditions seems to be satisfied in your case, bad debt is allowable.

Sanjay Agarwal

Sanjay Agarwal (Querist)
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30 July 2009 WHAT IS THE MEANING OF "THE AMOUNT WAS ACTUALLY WRITTEN OFF IN THE BOOKS OF ACCOUNTS"

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