9911796707
TMI Blog1934 (6) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... OWEN.- The point raised by this appeal is short and free from complication. The exact facts are in some respects a little difficult to ascertain but for present purposes they may be accurately stated thus : The appellant is a member of a firm who acted as agent for a limited company which carried on the business of a cotton mill. The appellant was assessed to income-tax under the Indian Income Tax Act, 1922, for the year 1929-30 on the basis of his income for the preceding year 1928-29. In that preceding year the firm had, under guarantees given by them, been compelled to pay and had paid to the lenders large sums which had been advanced to the limited company, and which the limited company had failed to re-pay. As a result, the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nding of fact on the evidence before him. In this their Lordships think that the Commissioner was mistaken and indeed the later history makes this clear. By an order of the High Court of Bombay dated January 30, 1931, and made under Section 66 of the Indian Income Tax Act, 1922, the Commissioner was compelled, somewhat reluctantly, to state a case upon the question of law which had arisen and to refer it to the High Court. The question which the Commissioner was directed to raise by the case stated was : Whether it is necessary to constitute moneys due by a joint stock company a bad debt or a business loss to the creditor that the company should be actually wound up or have ceased to be a going concern. In the case as stated th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or partly and to what extent bad or irrecoverable is in every case (and whether the debtor is a human being or a joint stock company or other entity) a question of fact to be decided by the appropriate tribunal upon a consideration of the relevant facts of that case. There is no jurisdiction for the suggestion that a practice should prevail in the Commissioner's office under which a debt due from a limited company which is still a going concern, is incapable of being treated as a bad debt. Their Lordships are of opinion that the order of the High Court should be discharged and in lieu thereof an order should be made answering in the negative the question which the Commissioner was directed to raise and which is set out above. As a re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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