9911796707
TMI Blog1997 (4) TMI 102X X X X Extracts X X X X X X X X Extracts X X X X ..... to Rajkot after a business tour of Ahmedabad and Baroda. During the brief halt at Limbdi Bus Station, out of total gold ornaments of 1027 gms, gold ornaments weighing 569 grams were stolen from his personal belongings kept in the Bus. A police complaint was lodged immediately at the Limbdi Police Station on 3rd Feb., 1988. The assessee continued to show the above stolen goods as part of his stock-in-trade not only during the said year i.e., asst. yr. 1988-89 but also in subsequent years at the market value. However, during the previous year relating to the assessment year under appeal, the assessee wrote off the value of the ornaments as irrecoverable in his books of accounts on the ground that there was no hope of recovery of the stolen g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the AO with the following brief remarks: "I have considered the rival submissions. As rightly pointed out by the AO, the matter had become final in the sense that the police had given the clear findings regarding non-recovery of the stolen ornaments on 19th June, 1988 i.e. in the year relevant to asst. yr. 1989-90 and, therefore, the appellant need not have waited for writing off the amount till the year under appeal. The AO's decision is therefore upheld." 5. Shri N.B. Shah, the learned counsel for the assessee submitted that the decisions of the learned AO and the CIT(A) are wholly unjustified both on facts as well as in law. He submitted that the fact that theft had taken place is not in dispute. The fact that the claim is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness and as such it is an allowable loss. Therefore, the crux of the controversy is the year of allowability of the impugned loss. In our opinion, a decision as to the year in which loss due to theft is deductible would rest on the facts and circumstances of each case but the basic principle to be considered in this connection is that loss must be actual and present. Loss ordinarily occurs when the moneys are lost to the assessee and there is no real chance of recovering then. The whole issue is to be viewed in the commercial sense and in the circumstances of the case the assessee was the best judge to take a decision as to the finality of the loss due to theft. In our opinion the assessee was nursing a bona fide belief that there was some ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it this additional evidence. In our view the disallowance of Rs. 5,000 out of total claim of Rs. 2,00,962 is in order and no interference is called for. This ground accordingly fails and is dismissed. 11. The next grievance of the assessee is with regard to the disallowance of Rs. 2,600 out of travelling expenses, Rs. 1,000 out of Dharmada expenses and Rs. 4,500 out of telephone expenses. The assessee claimed telephone expenses at Rs. 26,874. The AO disallowed a sum of Rs. 4,500 on account of personal use of the telephone. The CIT(A) confirmed the disallowance. In our view the action of the authorities below is justified as the use of the telephone for personal purpose cannot be ruled out. Similarly, the disallowance of Rs. 1,000 out of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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