CIT v. Abdullabhai Abdulkadar

M/S Mega Management Services Pvt Ltd., Mumbai vs. DCIT CC 6 (4), Mumbai

In the result, the appeal filed by the assessee is hereby dismissed

…he assessee committed an inadvertent mistake, but, we cannot go by notions of equity in tar matters. Making a provision is not the same thing as writing off a debt as irrecoverable.' 16. Relying upon the decision reported in CIT v. Abdullabhai Abdulkadar 1961 41 ITR 545 (SC), the Assessing Officer held that as the debt due was not an incident to the business, it cannot be termed as a debt and no deduction can be made on amount of bad debt and that it should be construed as a capital loss. It would be appropriate to quote the relevant portion of the said Judgment and the same reads as under. "Under clause (xi) als…

The Hindustan Co Operative Bank Ltd, Mumbai vs. Jt CIT 13(3), Mumbai

In the result, the assessee’s appeal is partly allowed and partly allowed for statistical purposes

Bench: Shri Sanjay Arora, Am & Shri Amarjit Singh, Jm आयकर अपील सं./I.T.A. No. 1501/Mum/2014 ("नधा"रण वष" / Assessment Year: 2009­10) The Hindustan Co­Operative Bank Ltd. Jt. Cit­13(3), बनाम/ 4­A, Devi Galli, Baburao Bobde Marg, Aaykar Bhavan, Vs. Lokhand Bazar, Mumbai­400 009 Mumbai "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aabat 4355 R (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Shri Amar Gahlot, Shri S. Sriram ""यथ" क" ओर से/Respondent By : Shri B. Satyanarayana Raja सुनवाई क" तार"ख / : 01.7.2016 Date Of Hearing घोषणा क" तार"ख / : 24.10.2016 Date Of Pronouncement आदेश / O R D E R Per Sanjay Arora, A. M.: This Is An Appeal By The Assessee Directed Against The Order By The Commissioner Of Income Tax (Appeals)­24, Mumbai (‘Cit(A)’ For Short) Dated 19.11.2013, Dismissing The Assessee’S Appeal Contesting Its Assessment U/S.143(3) Of The Income Tax Act, 1961 (‘The Act’ Hereinafter) For The Assessment Year (A.Y.) 2009­ 10 Vide Order Dated 21.12.2011. 2. The Assessee, A Co­Operative Bank In The Business Of Banking, Governed By The Banking Regulation Act, 1949 As Well As The Maharashtra State Co­Operative Societies Act, 1960, Claimed ‘Investment Loss Adjusted From Idr’ In The Sum Of Rs.80.991 Lacs In The Computation Of Its Business Income For The Year (Pb Pgs. 24­26). It Is This Claim

…state so as the shift (in category) is to necessarily serve a business purpose for it to be a deductible loss, and the same cannot merely be a device to save tax. As argued by the ld. DR with reference to the decision in CIT vs. Abdullabhai Abdulkadar [1960] 41 ITR 545 (SC), a loss becomes allowable only where it springs directly from and is incidental to the business of the assessee. True, the shift is permissible under the RBI guidelines, but being available for sale, so that it could be sold or, as the case may be, held till such time as considered proper by the assessee, including up to maturity, the shift h…