Consideration of Provision for bad & doubtful debts as operating expenses in computation of PLI

ADP Private Ltd. Vs CIT (ITAT Hyderabad) With regard to the working capital adjustment, it is the case of the assessee that the provision of bad and doubtful debts should be considered as operating expenses while computing the PLI. He submitted that the transactions can be considered as a comparable only after making adjustments to eliminate the differences that are likely to affect the cost and profit margin on controlled and uncontrolled transactions. In support of this contention, he placed reliance upon the I.T. Rules 1(10)B(i)(e) of the I.T. Rules. He further submitted that the assessee ...