Sri Rangavilas Motor Service vs Commissioner of Income Tax

Venkataswami, J.—Pursuant to an order of this court in T.C.P. No. 271 of 1971, dated November 12, 1979, the Tribunal has referred to

this court the following two questions:

(1) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in law in holding that the write off for the

purpose of the claim of bad debt u/s 36(2) of the Act should be made when the assessee makes up his accounts for the first time and not later on

at any time before the assessment was completed?

(2) Whether, on the facts and in the circumstances of the case, there was material, for the Tribunal to hold that the amount had not become

irrecoverable in the year of accounting?

On the facts, the Tribunal has found that the assessee filed a revised return for the year 1967-68 on March 26, 1972, whereas the assessment

order for that year was passed on March 25, 1972. That being the position on which there is no dispute, the claim for write off having not been in

accordance with the requirement of section 36(2) of the income tax Act, 1961, we do not think there is any case for interference with the

conclusion reached by the Tribunal as it is clear that the assessee has not written off at least before the assessment order was made for the relevant

year. In view of the fact as found by the Tribunal and as accepted by us, we answer the first question in the affirmative and against the assessee. In

view of our answer to question No. 1, it is not necessary for us to answer question No. 2. Hence, we return that question without answering the

same.