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2016 (8) TMI 558 - HC - Income TaxBusiness loss - whether tribunal was not justified allowing the deduction paid to Andhra Bank by the assessee as a one-time settlement to clear the dues of M/s. New Tobacco Company, a group concern as the business expenses of the assessee although the same is not paid for the business of the assessee in deviation from the law and the statute? - Held that:- Tribunal was wrong in proceeding on the basis that the Reserve Bank of India had issued a caution notice. We asked Mr. Khaitan to produce the caution notice before us for consideration. Pursuant to our request, Mr. Khaitan has produced before us a news item published in the business page of The Telegraph dated March 31, 1995 from which it appears that the caution notice issued by the Reserve Bank of India had been withdrawn on or prior to March 30, 1995. The contents of a news item published in a newspaper are not admissible in evidence. What is admissible is that such a news was published. Whether it is correct or incorrect there is no evidence with regard thereto. Even assuming that such a news was published on March 31, 1995, it appears that the caution notice issued by the Reserve Bank of India had already been withdrawn. Therefore, the learned Tribunal was wrong in proceeding on the basis that it is due to the pressure exerted by the Reserve Bank of India that the assessee was made to pay the debt due by New Tobacco Company to the Andhra Bank. There was nothing before the learned Tribunal to show that the Andhra Bank would not have advanced any further money to Andhra Cements Ltd. except upon payment by the assessee the dues owed by New Tobacco Company. Even assuming for the sake of argument that there was any such situation then the payment of ₹ 1.35 crores would take the character of the cost of acquisition of the shares of Andhra Cements Ltd. acquired by the assessee shortly before such payment. It is an admitted fact that the Andhra Cement Ltd. was acquired by the assessee in the year 1994 while the Andhra Cements Ltd. was in a BIFR proceeding. The learned Tribunal was utterly wrong in holding that the amount paid by the assessee to the bank in settlement of the debt owed by New Tobacco Company was a business loss of the appellant. - Decided in favour of the Revenue.
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