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Reduced Recovery of Loan Advanced, Allowable as Deduction as Business Loss
Case Law Details
- Case Name
- CIT Vs M/S Cable Corporation of India LTD. (Bombay High Court)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 1978-79
- Courts
- All High Courts, Bombay High Court
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CA Isha Seth
Brief Facts:
1. The assessee company sold its right to recover a sum of Rs. 103 lakhs from Varun, to M/s Pearl Thread Mills Ltd. as an actionable claim for Rs. 45 Lakhs for the relevant assessment year under consideration.
2. The assessee company claimed the differential loss of Rs. 57,84,590/- by writing it off as bad debts. The assessee claimed the same as deduction from the total income as business loss.
CIT (Appeals) Order
Subsequently, the CIT(A) held that it was not in ordinary course of business of the company to advance loans. It was not a business loss as this was a loa...
