The assessee is engaged in the business of financing trading etc. The assessee has claimed bad debt  out of purchase and sale of on the platform of National Spot Exchange  Ltd ( NSEL) through Motilal Oswal Commodities Brokers Pvt Ltd . The scam was unearthed in July 2013  which revealed that NSEL had defaulted in its payment obligations to various investors and traders from August 2013 . The management of the assessee decided to write off 25% of the outstanding amount as bad debt on 30 -9 2013 in the books of account . The AO has disallowed the claim which was affirmed by the CIT (A)  .Appeal by the assessee the Tribunal held that the NSEL had started functioning  since 2007 . Due to scam in July 2013 the NSEL defaulted in its payment obligations to various investors and traders from August 2013 . Writ petition was filed before Bombay High Court and Gujarat High Court and a committee was appointed for monitoring the recovery   . Following the ratio in TRF Ltd v CIT ( 2010)  323 ITR  397 (SC) , the Tribunal held that amount written off in the books of account is allowable as bad debt . ( ITA No. 3649/Mum/ 2018 dt . 10 -1 2020) (AY. 2014 -15)