1980 (5) TMI 75

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....bit balance in the name of his capital account. The GTO held that the write off of the debt on 31st March, 1973 by the assessee amounted to deemed gift under s. 4(1)(c) of the GT Act. The AAC who first heard the appeal, held that the sum of Rs. 50,000 was not taxable to gift-tax. However on Revenue's further appeal the Tribunal (Madras Bench 'A') by its order, dt. 11th May 1978. set aside the order of the AAC and restored the matter to his file to consider- (a) if the abandonment of debt by the assessee is not for a bona fide reason; (b) whether the unilateral act of the assessee in writing off the debt in the books of account constitute abandonment of the debt? and (c) if the assessee's son was still showing the debt in his wealth-tax r....

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....bt only during the year by transferring it to his capital account the assessee had ceased to have any right to the amount after the limitation had expired. There was no consultation between the parties in writing off the debt. He urged that it was; unable to recover the amount and due to the close relationship and the delicacy involved in the strict enforcement of collection of the amount and since any Court action would have strained the relationship with the son, the assessee had no alternative but to write off the debt. The ld. counsel also referred the following High Court decisions: (1) CGT vs. Abraham Kotchuthomman (1979) 98 ITR 394 (ker). (2) CGT vs. Padampat Singhania (1979) 117 ITR 323 (All). 4. In reply, the ld. Dept. Rep. supp....