https://www.taxtmi.com/caselaws?id=351771 Cancellation and settlement of import contracts gave rise to a business loss, not a speculative loss under section 43(5), because the assessee failed to honour contractual obligations and paid damages or indemnification for breach. The transactions were not settled through trading without delivery or through futures or options dealings. Where parties settle only the quantum of compensation after breach, the payment is treated as damages for contractual default rather than a speculative settlement. On the facts, no sale had taken place and the amount was paid solely to compensate the other contracting parties, so the loss was allowable as a business loss. en-us Thu, 11 May 2017 00:00:00 +0530 Thu, 30 Nov 2017 14:54:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=351771 Cancellation and settlement of import contracts gave rise to a business loss, not a speculative loss under section 43(5), because the assessee failed to honour contractual obligations and paid damages or indemnification for breach. The transactions were not settled through trading without delivery or through futures or options dealings. Where parties settle only the quantum of compensation after breach, the payment is treated as damages for contractual default rather than a speculative settlement. On the facts, no sale had taken place and the amount was paid solely to compensate the other contracting parties, so the loss was allowable as a business loss. Case-Laws Income Tax Thu, 11 May 2017 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=351771