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TaxTMI 
TaxTMI 
TaxTMI 
2020 (9) TMI 970
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....mitted by a bench of this Court vide order dated 08.10.2013 on the following substantial question of law: (i) Whether the Tribunal was justified in law in holding that the amount written off by the Appellant incurred towards M/s. Ace International Inc., during the Financial Year 2003-04 amounting to Rs. 3,41,23,200/- is in the nature of capital loss but not business loss under the facts and circumstances of the case? (ii) Whether the Tribunal was justified in law in not appreciating that the investments in M/s. Ace International Inc., were made purely on account of commercial expediency for enhancing the business activities of the Appellant and such investment subsequently written off during the Financial Year 2003-04 in s....
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....ice under Section 143(2) of the Act was issued to the assessee. The assessee duly complied with the notice and furnished requisite details, as sought for by the assessing officer. The assessing officer vide order dated 13.12.2016 determined the total income of the assessee at Rs. 18,01,52,340/- by disallowing the claim of business loss of Rs. 3,41,23,200/- and concluded the assessment. The aforesaid order was challenged by the assessee before the Commissioner of Income Tax (Appeals) who by order dated 31.08.2009 dismissed the appeal of the assessee. The assessee thereupon approached the Income Tax Appellate Tribunal. The tribunal by an order dated 14.12.2012 dismissed the appeal of the assessee. In the aforesaid factual background, the asse....
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....aid up amount, which could not be treated as share capital and the tribunal ought to have atleast considered such portion as allowable expenditure on the facts of the case. It is also pointed out that the Reserve Bank of India had permitted the assessee on 22.04.2004 and 23.06.2004 to wind up WOS in USA and also write off exports receivable. In support of aforesaid submissions, reliance has been placed in 'CIT VS. M/S COLGATE PALMOLIVE (INDIA) LTD', 370 ITR 718 (BOM.), 'PATNAIK AND CO LTD. VS. CIT', 161 ITR 365 (SC), 'CIT VS. INVESTA INDUSTRIAL CORPN. LTD', (1979) 119 ITR 380, 'ADDL. CIT VS. BMS (P) LTD', 119 ITR 321 (MAD.), 'CIT VS. DHANDAYUTHAPATI FOUNDRY (PRIVATE) LIMITED', 123 ITR 709 (MAD.), 'INDIAN COMMERCIAL AND INDSUTRIES CO. (P) LT....
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....rd. The core issue, which arises for consideration in this appeal is with regard to disallowance of business loss written off on account of loss arising out of business investment from WOS in USA. It is well settled legal proposition that while deciding the question whether a receipt is a capital or income, it is not possible to lay down any single test as infallible or any single criteria as decisive. The question must ultimately depend on fact of particular case and authorities bearing on the question are valuable only as indicating the matters that have to be taken into account in reaching a decision. It has further been held that for determining the question of capital and incomes, trading profit or non trading profit are questions do i....
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....ed by the assessee was a revenue loss and not a capital loss. In INVESTA INDUSTRIAL COPORATION LTD., supra, the division Bench of the High court dealt with a question whether the finances made by the assessee to manage the company were part of or incidental to carrying on a business by the assessee a and since, the managed company went into liquidation the advances became irrecoverable, the loss sustained by the assessee shall be regarded as trading loss. 7. In the backdrop of aforesaid well settled legal position, the facts of the case in hand may be adverted to. From the perusal of the note annexed to the income filed before the assessing officer, it is evident that assessee had set up an establishment in USA during Financial Year 1992....