TaxTMI 
TaxTMI 
1962 (10) TMI 63
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....lates to the assessment year 1957-58, the accounting year being 1956-57. The assessee derived income from several sources, one of them being the agency of Tata Mercedes Benz. It would appear that a stranger came to the assessee's shop during business hours, sat down near the cash box and was talking to him. Just then, he had to go into another room to talk on the telephone. Taking advantage of this situation, the stranger is said to have removed the cash from the cash box and disappeared with it. The assessee claimed this loss under section 10(1) of the Indian Income-tax Act as an allowable deduction as incidental to the carrying on of the business. This was disallowed by the revenue. The appeals carried by the assessee to the Appell....
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....ntrolled by statutory rules framed under the Bihar Sugar Factories Control Act, and that by virtue of these rules the assessee company was bound to set up purchasing centres and to locate weigh-bridges for the purchase of sugarcane. The assessee company was also bound to purchase sugarcane at these weighment centres and to make payment to the sugarcane cultivators within a fortnight of the date of weighment. It is thus seen that sending money through an employee for the purpose of distribution among the sugarcane growers was an incident of business. It is in such a situation that the learned judges treated the loss as directly connected with the business and as such it was a trading loss. That decision has no parallel here. Nor does Badr....
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....to yield taxable profits has to be carried on through agents, cashiers, clerks and peons. Salary and remuneration paid to them are admissible under section 10(2)(xv) as expenses incurred for the purpose of the business. If employment of agents is incidental to the carrying on of business, it must logically follow that losses which are incidental to such employment are also incidental to the carrying on of the business. Human nature being what it is, it is impossible to rule out the possibility of an employee taking advantage of his position as such employee and misappropriating the funds of his employer, and the loss arising from such misappropriation must be held to arise out of the carrying on of business and to be incidental to it." T....
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....elation of his, who at the material time was his accountant, walked into his residential house, got hold of the keys without the knowledge of the assessee, came to the business premises, forced his entry into the shop and after opening the iron safe removed Rs. 8,995 (leaving behind the balance) out of which Rs. 320 was later on recovered from him and it is the balance of Rs. 8,675 which was claimed as business loss. This was disallowed by the concerned Income-tax Officer, which was upheld by the Appellate Assistant Commissioner and the Income-tax Appellate Tribunal. In a reference under section 66(1) of the Indian Income-tax Act, the Orissa High Court agreed with the view of the department and of the Appellate Assistant Commissioner and an....
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....s nature could not be regarded as incidental to the carrying on of the business. The observation relied upon by the learned counsel for the assessee does not, therefore, render any assistance to the assessee. In Ramaswami Chettiar v. Commissioner of Income-tax* a Full Bench of the Madras High Court took the view that the loss which occurred by theft of money used in the money-lending business was not an allowable deduction where the theft was committed by persons who were not at the time of the offence employed as clerks or servants in the business of the assessee. Curgenven J., one of the members of the Full Bench who agreed with Beasley C.J. in disallowing the claim of the assessee, observed, inter alia, as follows: "To recognise it....