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1962 (10) TMI 52 - SC - Income Tax
Whether the amount claimed by the assessee company as a deduction was not admissible either under section 10(2)(xi) or 10(2)(xv) ?
Held that:- Appeal dismissed. An advance paid by the assessee company to another to purchase shares cannot be said to be incidental to the trading activities of the assessee company. It was more in the nature of a price paid in advance for, the shares which the Southern Agencies had a right to allot in the Rodier Textile Mills Ltd. This cannot, therefore, be described as a debt and indeed the changes in the books of account of the assessee company clearly show that the assessee company itself was altering the entries to convert the advance into a debt so as to write it off and claim the benefit of section 10(2)(Xi). Thus section 10(2)(xi) was inapplicable to the facts of this case.