A business can claim a deduction for a bad debt even if efforts to recover the money are still underway, the Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has ruled. In an order pronounced on June 30, 2026, the Tribunal allowed Ahmedabad-based commodity trading firm Hemant Brothers to claim a deduction of Ra 2.69 crore arising from the National Spot Exchange Ltd. (NSEL) payment crisis. It held that once a debt has been written off in the books of account and the conditions prescribed under the Income-tax Act are fulfilled, the deduction cannot be denied merely because recovery proceedings are pending.