2012 (7) TMI 180

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.... and in law the Assessing Officer has erred in computing the income of the appellant company at Rs. 10,36,155.00 as against return filed declaring loss of Rs. 31,41,921.00, by disallowing "Bad Debts" claimed u/s 36(1 )(vii) of the Act at Rs. 41,73,881.00. That the authorities below have disallowed the claim of "Bad debts" on wholly erroneous, illegal and untenable grounds, and it is prayed that the same be allowed as in law. ii) That the authorities below have failed to appreciate that the appellant company is a share broker and a member of The Delhi Stock Exchange Ltd. and is governed by the Rules & Regulations of the Exchange which make it obligatory for it to make payment to the Exchange of amounts payable against shares purchased irr....

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....oss of "revenue nature" is an allowable deduction in the computation of its income in terms of sections 28 & 29 of the Act. vii) That the appellant company craves leave that it may be permitted to amend, delete, modify all or any of the above grounds of appeal, and / or add any fresh ground before and / or in the course of the appeal proceedings. 3. The facts of the case are that the assessee company is a member of Delhi Stock Exchange and is carrying on the business of shares and stock broking alongwith the allied activities such as brokers/subbrokers, underwriters to new issues of shares, debentures and securities of all kinds, brokers and fixed deposit of companies, trading in shares, investment consultants etc. 3.1 The assessee....

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....else in the market and in the absence of such a sale, the assessee could not claim the aforesaid amount as 'bad debt'. Insofar as the first submission of learned counsel for the Revenue is concerned, we do not find any force therein. As pointed out in the aforesaid admitted facts, the assessee had purchased the aforesaid shares on behalf of the sub-broker and, in fact, paid the amount of Rs. 1,06,10,247/-. As against this amount, he received only a sum of Rs.64 lacs. The brokerage which was received in the aforesaid transaction was shown as income by the assessee in the previous year, which was taxed as such as well by the Assessing Authority. Under these circumstances, only because shares were not delivered for want of full payment, whi....