SHIVANI TEXTILE LTD. vs. ACIT, CIRCLE 8(1)


% 05.08.2008

Present: Mr. Rishi Aggarwala, Advocate for the Appellant.

Mr. Sanjeev Sabharwal, Advocate for the Respondent.

+ CM No.11102/2008 in ITA No. 949/2008

Allowed subject to all just exceptions.

+ <u>1TA No. 949/2008</u>

This appeal has been preferred by the assessee against the order of the Tribunal dated 16.11.2007 in respect of the assessment year 2001-02. The assessee had given a sum of Rs.40.00 lacs to one Mr. Gautam Nemani, who is a share broker. After some difficulty, the assessee was able to recover only a sum of Rs. 10.00 lacs. The balance sum of Rs. 30.00 lacs was written off as a bad debt by the The Assessing Officer rejected the plea taken by the assessee. assessee that the said sum of Rs. 30.00 lacs be written off as bad debt. The Assessing Officer was of the view that the sum of Rs. 40.00 lacs which had been given to Mr. Gautam Nemani was for investment in shares and, therefore, the amount of Rs. 30.00 cannot be written off as a bad debt, but has to be construed as a capital loss. This finding of the Assessing Officer was confirmed by the CIT (Appeals).



proposed to be purchased from Mr. Gautam Nemani were to be held as stock-in-trade of the business of investment in shares. It was held that the loss in question, therefore, could not be considered as one which occurred in the course of any business which the assessee carried on or intended to carry on. The tribunal confirmed the finding of the Assessing Officer and the CIT (Appeals).

We find no cause to interfere with the reasoning and findings of the Income Tax Appellate Tribunal. In any event, no substantial question of law arises for our consideration. The appeal is dismissed.

BADAR DURREZ AHMED, J

RAJIV SHAKDHER, J

August 05, 2008 mk

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