Business rent payments and share-trading loss claims upheld as genuine, rejecting conjecture and sustaining tax deductions.

Deductibility of alleged rent was upheld because rent payment was undisputed and, on concurrent findings of the CIT(A) and Tribunal, the premises were taken for business purposes; absence of cross-examination of a caretaker and speculation about the nature of occupation could not displace those findings. Accordingly, the rent expenditure was allowable and the Tribunal's finding was not perverse. Disallowance of share-trading loss was rejected since transactions were executed through a registered stock-broker and stock exchange quotations corroborated the trades; the loss could not be denied on conjecture about local practices or on immaterial discrepancies in quantity. Consequently, the Tribunal's acceptance of the share loss was held to be based on record and not perverse, and the appeal was decided in favour of the assessee and against the revenue.

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Issues:
1. Allowance of deduction of business expenditure for alleged rent.
2. Allowance of share loss in the purchase and sale of shares.

Issue 1 - Allowance of Deduction of Business Expenditure for Alleged Rent:
The assessee, an investment company, claimed a deduction of Rs. 36,000 as rent for premises at Flat No. 84, Middleton Street, Calcutta. The Income Tax Officer initially disallowed the rent deduction based on an adverse report from an Inspector regarding the usage of the premises. However, the Commissioner (Appeals) allowed the claim, noting common practices in Calcutta where rent can be adjusted against advances to landlords. The Tribunal upheld this decision, emphasizing that the premises were used for business purposes, regardless of whether it was for an employee or director. The Tribunal found the findings of the Commissioner (Appeals) to be based on relevant evidence, thus not perverse.

Issue 2 - Allowance of Share Loss in Purchase and Sale of Shares:
The assessee claimed a loss of Rs. 49,210 in share dealings, which was initially disallowed by the Income Tax Officer and upheld by the Commissioner (Appeals) citing inadequate records and suspicions of bogus claims. However, the Tribunal disagreed with these findings, noting that the transactions were conducted through registered brokers and the share rates were verified. The Tribunal emphasized that the claim of loss should not be dismissed based on conjectures, and found in favor of the assessee, concluding that the loss in share dealings was genuine. The Tribunal's decision was based on the materials on record and not considered perverse.

In conclusion, the High Court of Calcutta ruled in favor of the assessee on both issues, affirming the Tribunal's decisions regarding the allowance of deduction for alleged rent and the share loss in purchase and sale of shares.

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