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2019 (2) TMI 730 - HC - Income TaxIncurring business loss on account of guarantee extended in the ordinary course of business - revenue's contention was that the loss was not suffered in the course of assessee's ordinary business activity and therefore, cannot be claimed as a business loss - Held that:- After one round of remand, the Tribunal examined the material on record and in particular Memorandum and Articles of Association of the assessee company to come to the conclusion that the said Articles of Association permitted the assessee company to engage in activity of providing corporate guarantees in favour of other persons and entities. It was pursuant to this Article of Association that the assessee had engaged itself in such activity, providing corporate guarantee for credit facilities sanctioned by Vysya Bank to one Geekay Exim (India) Pvt. Ltd.& Ors. In the process, the assessee had incurred loss. The assessee had also taken reasonable steps for making recoveries by filing civil suits. Thus, on facts, the Tribunal hold in favour of the assessee on both counts namely; that the loss was genuine and that it arose out of the assessee's normal business activities. No error in view taken by the Tribunal.
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