TMI Blog1976 (4) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... ers. The lower authorities found that the assessee had paid interest to non-relatives only at the rate of 12 per cent per annum. So, the interest paid to the relatives in excess of 12 per cent, which worked out to Rs. 3,529 was disallowed. This is the first item of dispute before the Tribunal. 3. During June-July, 1972, the assessee, through its brokers Yadalam Co. contracted to sell to three parties to Jaipur, Jalgaom and Jamnagar in all 1,430 bags of ground nut at certain rates. The assessee had delivered part of the goods agreed to be sold in the case of two parties of 560 bags. There were correspondence between the assessee and the brokers who insisted on the delivery being given of the balance or the transaction being settled. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... During the assessment year in question payment of interest at 15 per cent cannot, in any way, be stated to be excessive. As such, the disallowance of interest payment in excess of 12 per cent cannot be supported. Hence this claim is allowed and the interest payment disallowed of Rs. 3,529 is set aside and such interest is also allowed. 5. The main issue in this appeal is whether Rs. 11,133 is a speculation loss or a loss incurred by the assessee in the course of business. On 6th June, 1972, the assessee entered into a contract with Premier Vegetable Products, Jaipur for sale of 550 bags of groundnut through the brokers Yadalam Co. On 7th June, 1972, the assessee entered into a contract with Mohanlal Premraj, Jamnagar for sale of 320 ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt out that s. 43(5) of the Act dispenses with all other formalities except that there must be actual delivery or transfer of the commodities when the contract was settled, and that a transaction with is not otherwise speculative in nature yet may be speculative, according to Expln. 2 to s. 24(1) of the 1922 Act, corresponding to s. 43(5) of the 1961 Act and that when no actual delivery was given, the Explanation makes it clear that it was only a speculative transaction. In the face of the principles of the decisions stated above and since, admittedly, no delivery was given of 870 bags of groundnuts and the assessee had subsequently chosen to settle the contract, we are convinced that the loss claimed is only a speculative loss. 6. The le ..... X X X X Extracts X X X X X X X X Extracts X X X X
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