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TMI Blog1970 (7) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... tion from the total income of the previous year because the receipt of the said interest was included in the total income of the respective years being revenue receipts X X X X Extracts X X X X X X X X Extracts X X X X ..... artners including Sri Jagannath Prasad who was a working partner. At the close of the Samvat year 2009-2010, Jagannath Prasad retired from the firm. At the time of retirement there was a debit balance in the capital account of Sri Jagannath Prasad which stood at Rs. 94,544 at the end of Samvat year 2011-2012. The amount consisted of the following two items : (i) Rs. 55,242, on account of excess dr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also assessed from year to year, on the amounts of interest debited to his account. Nevertheless, it appears to us, the firm cannot claim the sum of Rs. 39,302 being the amount of interest debited to the account at the end of the relevant accounting year as bad debt under section 10(2)(xi) of the Act. As already stated, the firm used to carry on business in arhat as well as in gur and shakkar. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s written off as irrecoverable. Thereupon, the assessee claimed a deduction of Rs. 53,694 being the amount written off, in computing the assessable profits. Beaumont C.J., who delivered the leading judgment of the Bench, observed that the debts due from the retiring partners were never revenue of the continuing firm ; they were capital sums and the loss could not be written off as against the prof ..... X X X X Extracts X X X X X X X X Extracts X X X X
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