COMMISSIONER OF INCOME TAX Vs. GETIT INFOMEDIARY LIMITED

JUDGEMENT

(1.) THIS appeal preferred by the revenue in respect of the assessment year 2003-2004 against the order of the Tribunal passed on 22. 06. 2007 is concerned with the issue of writing off bad debts by the assessee.

(2.) THE Tribunal, after examining the amendment brought about in Section 36 (1) (vii) of the Income Tax Act, 1961 (hereinafter referred to as the "said Act")with effect from 01. 04. 1989, arrived at a conclusion that the deduction claimed by the assessee on account of bad debts, part of which were from government departments and the remaining part from private parties, was fully allowable as bad debts written off under the provisions of Section 36 (1) (vii) read with section 36 (2) of the said Act.

(3.) IT may be relevant to note that in the return of income filed by the assessee a deduction of Rs 1,67,33,202/-was claimed by the assessee on account of bad debts written off. Out of this sum an amount of Rs 1,13,40,655/- was in respect of the government telephone department and the remaining amount was in respect of private parties. The Assessing Officer had disallowed the claim of the assessee for deduction of the said amount claimed as bad debts to the extent of 25% relating to the government telephone department and 15% relating to the other private parties. This resulted in an addition of Rs"36,44,046/ -.