9911796707
TMI Blog2002 (8) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... income of Rs. 4,25,370 for the asst. yr. 1991-92. The AO added an amount of Rs. 1,31,387 to the declared income on the basis of percentage of expenditure relating to asst. yr. 1990-91 and the AO also made other additions against which assessee went in appeal before the CIT(A) who did not oblige the assessee. Hence, this appeal has been filed before us and the assessee has raised various grounds of appeal, which we will deal one by one. 3. At the time of hearing Shri S. Venkatesan, learned authorised representative. appeared on behalf of the assessee and Shri P.C. Chadaga, learned Departmental Representative was present on behalf of the respondent-Department. The first ground of appeal relates to addition in lorry hire account amounting t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a of the assessee and send these issues viz. addition in lorry hire account, addition in tax paid rice account and addition in gram flour account to the file of the CIT(A) with a direction to adjudicate upon these additions on merits and in case the assessee is able to demonstrate before him that the additions are not warranted, additions should be deleted without prejudicing his mind by the fact of admitted additions by the assessee. 5. The next issue raised by the assessee is that the authorities below are not justified in disallowing the sum of Rs. 3,07,333 being loss sustained on account of setting aside of the auction sale under the facts and in the circumstances of the case. According to the assessee this loss is not a capital loss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e debited immovable property account and credited interest account a sum of Rs. 2.74 lakhs on 2nd Nov., 1986, and offered the interest amount to be taxed in the asst. yr. 1987-88. Thus, the immovable property account showed a debit balance of Rs. 5,81,250. The High Court of Karnataka declared that the title that passed to the assessee was not a valid title. Copy of the decision of the Hon'ble Supreme Court is placed before us. The plea of the counsel for assessee is that the investment made by the assessee in property never became capital asset as defined in s. 2(47) of the Act because of the defective title and as a result, the assessee was not holding any asset and hence investment could not be construed as a capital asset. So, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is at p. 47 of the paper book depicts in which the circumstances leading to the cancellation of the auction are explicitly given. The details of expenditure incurred towards repairs of building in question are given at pp. 61 to 64 of the paper book, which again proves the total cost incurred on the building which is shown at p. 37 of the paper book. We are convinced that the bad debt is equal to loss incidental to Hon'ble High Court's order, which cannot be said to be a capital loss in the peculiar circumstances of this case. The order of the Hon'ble High Court came on 7th March,1985, and the assessee had to undergo various nuances during that period until the final verdict of the High Court came. Thus, the assessee did suffer loss on acco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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