TaxTMI 
TaxTMI 
1966 (1) TMI 16
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....iness in shares, jute and speculation. The question referred to relates to the assessment year 1952-53. During the accounting year ending on 31st of August, 1951, the assessee-company transacted business in jute which resulted in a profit of Rs. 59,91,721. The assessee claimed that out of the profit a sum of Rs. 14,30,561 was in respect of various transactions of purchase and sale of jute on account of Dalmia Cement Paper Marketing Co. Ltd., hereinafter referred to as " D.C.P.M. Ltd.". The Income-tax Officer negatived the aforesaid claim of the assessee on several grounds. The assessee went in appeal before the Appellate Assistant Commissioner, but its claim was rejected. The question was also specifically raised in further appeal before th....
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....ribunal. It was the definite case of the assessee that D.C.P.M. Ltd. had already been assessed for the disputed sum of Rs. 14,30,561. It does not appear from the order of the Tribunal that the same was not accepted. The assessee also filed a copy of the credit advice dated the 31st August, 1951, sent by D.C.P.M. Ltd., crediting the assessee-company with Rs. 70,27,578 as representing the cost of 94,775 maunds and 391/4 seers of jute purchased on account of that company and adjusted as advised and bills, etc., received. The Tribunal has not doubted the genuineness of that document but has not relied on the same because or the various grounds which I have already stated. I may state here that, according to the assessee, by a letter dated the 1....
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....Tribunal for rejecting the claim of the assessee. As regards the first ground it was admitted that the Tribunal has not taken judicial notice of the fact that it is the usual practice in transactions of this nature to enter into agreement for purchase orally and the absence of documentary evidence to show that the assessee was required to undertake transactions on behalf of D.C.P.M. Ltd. should not have been made a ground for disallowing the claim of the assessee. The above contention has some force and it cannot be brushed aside. Regarding the second ground, it was contended that, as it was the prevailing custom of the trade to debit the supplier's ledger with the actual payment, no entry was made in the books of account of the assessee im....