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2013 (8) TMI 240 - HC - Income TaxCapital loss as revenue expenditure - Writing off the assets - Tribunal deleted disallowance - Held that:- Requirement was of the Government to furnish the bank guarantee from the nationalized bank or the scheduled bank. The Assessee had availed such bank guarantee facilities - The prescribed norms of the bank had noted the purchase of the shares and margin money for using the bank guarantee also was required to be kept as a fixed deposit. This co-operative bank, when eventually was declared as sick bank, was unable to repay the deposits, the membership of the said bank also was cancelled and the steps were taken pursuant to the order of the Reserve Bank of India. Assessee-company, thereafter, had written off the balance - Therefore, expenditure were needed to be spent by the assessee for the purpose of carrying on its business and are incidental to the business, therefore, any loss shall have to be considered as the revenue cost and not the capital cost - Following decisions of Ramchandar Shivnarayan v. CIT [1977 (11) TMI 2 - SUPREME Court] and Indian Aluminium Co. Ltd. v. CIT [1972 (3) TMI 1 - SUPREME Court] - Decided against Revenue.
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