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Issues:
1. Addition made to profits from the sale of petrol 2. Disallowance of depreciation on motor lorries disposed of on hire-purchase 3. Alleged bad debt due to default on hire-purchase agreement Analysis: 1. The applicant, a hardware merchant dealing in petrol and oil, contested an addition to profits from petrol sales due to inadequate record-keeping. The Income-tax Department deduced the income based on surrounding circumstances as the accounts were poorly maintained. The court upheld the Department's assessment, noting the lack of proper records and permissible deduction methods. 2. Regarding depreciation on motor lorries disposed of on hire-purchase, the applicant belatedly claimed depreciation after an amendment to the Income-tax Act. The court found the claim unsubstantiated, as no accounts or entries supported the assertion. The hire-purchase system was deemed akin to a sale, not a lease, making the applicant ineligible for depreciation allowances. The court rejected the claim, emphasizing the lack of evidence and the nature of the hire-purchase agreement. 3. The final issue concerned a disputed bad debt claim of &8377; 756 arising from a repossessed vehicle under a hire-purchase agreement. The court noted that the vehicle's value post-repossession was uncertain until a subsequent sale. As the actual worth was undetermined, the claim could not be classified as a bad debt. The Income-tax Department's decision to withhold the allowance until the property was realized was deemed appropriate. In conclusion, the court dismissed the applicant's claims, highlighting the lack of evidence, proper documentation, and uncertainty surrounding the disputed amounts. The application was rejected, with the forfeiture of the deposit and the imposition of counsel fees. The appeal was consequently dismissed, affirming the Income-tax Department's decisions on the contested issues.
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