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1964 (9) TMI 11 - SC - Income Tax
Whether loss of cash by dacoity is an admissible deduction under section 10(1) of the Indian Income-tax Act, 1922 in computing the assessee's income in a banking business?
Held that:- In the present case the respondent was carrying on the business of banking. It is an integral part of the process of banking that sufficient moneys should be kept in the bank duly guarded to meet the demands of the constituents. The retention of the money in the bank is a part of the operation of banking. The retention of money in the bank premises carries with it the ordinary risk of its being subject of embezzlement, theft, dacoity or destruction by fire and such other things. Such risk of loss is incidental to the carrying on of the operations of the business of banking. In this view, we are clearly of the opinion that the loss incurred by dacoity in the present case is incidental to the carrying on of the business of banking. Appeal dismissed.