https://www.taxtmi.com/caselaws?id=10138 Losses directly arising from an illegal business, including confiscation of smuggled goods by customs authorities, are deductible in computing taxable profits. The Tribunal's finding that the assessee was engaged in smuggling gold was supported by the customs record and the assessee's admission, and that factual basis was upheld. Once the activity was accepted as an illegal business, the confiscation loss was treated as an incidental business loss and could not be ignored merely because the related asset had been brought to tax as unexplained investment. The principle applied was that tax can be levied on profits, not gross receipts, even in an unlawful business, and the deduction of the confiscation loss was therefore sustained. en-us Fri, 17 Oct 2003 00:00:00 +0530 Wed, 18 May 2016 11:57:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=10138 Losses directly arising from an illegal business, including confiscation of smuggled goods by customs authorities, are deductible in computing taxable profits. The Tribunal's finding that the assessee was engaged in smuggling gold was supported by the customs record and the assessee's admission, and that factual basis was upheld. Once the activity was accepted as an illegal business, the confiscation loss was treated as an incidental business loss and could not be ignored merely because the related asset had been brought to tax as unexplained investment. The principle applied was that tax can be levied on profits, not gross receipts, even in an unlawful business, and the deduction of the confiscation loss was therefore sustained. Case-Laws Income Tax Fri, 17 Oct 2003 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=10138